In this paper, a techno-commercial analysis method based on comparing 3 coal exporting countries in

Asia–Pacific region has been done for a 6 x 660 MW imported coal based ultra mega power plant

employing supercritical technology from Shanghai Electric Corp., China located in Krishnapatnam (A.P,

India) to show “How much economic is importing coal for Krishnapatnam UMPP ”. Annual coal

requirement is 15.33 MTPA @ 4290 Kcal/Kg (GCV) on GAR basis from Indonesia. FOB for Indonesian is

$ 50 /T & landed cost is $ 70.4 /T on CIF basis at plant site. Coal is imported in CAPESIZE vessels of

1, 75,000 DWT (87,500 GRT) @ 15 Knots in 7.5 days from Indonesia. KUMMP was awarded to

RELIANCE POWER LTD, & PPA of levelised tariff of Rs. 2.33/Kwhr has been signed between the

beneficiary state (T.N, A.P, Maharashtra & Karnataka) for 25 years. Analysis for cost formation of the

landed cost of imported coal at power plant site as well as the effects of coal consumption , cycle time

of vessels, different routes, duration & delivery time and characteristics of Indonesian coal has been

discussed. Indonesian coal is most economical because of short distance and huge availability to meet

plant requirement. Thus coal consumption is reduced by employing supercritical technology in KUMPP

as heat energy produced by imported coal is more efficiently utilised for generating electricity.

Ultr a Mega Power Plant 6 x 660 MW

umpp is located near krishnapatnam village in muttukur mandal of Nellore distt of coastal Andhra Pradesh.

LATITUDE 140 – 18’ – 26” N & LONGITUDE 800 – 07’ – 11.81” E. It has 6 units of 660 MW each which is to be

commissioned by 1st April 2013. The has installed capacity of 3960 MW. Contracted capacity is of 3465

MW to 3762 MW, employing supercritical technology from Shanghai Electric Grp,China. .

Some parameters to be considered for each unit :-

• Pressure: 247 kg/sq.cm (abs)

• Main steam temp :535 ° C

• Reheat temp : 565 ° C

• Station heat rate : 2250 Kcal / Kwhr

• Availability :90 %

• PLF : 85%

Project Dynamics

• The most suitable location for importing coal are south Africa, Australia & Indonesia in Asia- Pacific

region.

• 15.33 MPTA is annual coal requirement , 2076 tph ,49824 tpd @ 4290 Kcal/Kg (gcv) on GAR basis.

• Coal is imported on AR & DB basis .

a. AR (as received)- includes total moisture

b. DB (dry basis) - excludes all moisture

• Sharing of power- 40 % to A.P & 20 % to Maharashtra, T.N, Karnataka each.

• The nearest port to plant site is Krishnapatnam port.

a. One of the India’s largest and fastest growing seaports, Krishnapatnam Port.

b. It is fast becoming a port of choice for all international cargo originating from and destined to the

Southern and Central India.

c. Can store 0.63 MT (15 days) of coal at port and 1.26 MT at plant site for (30 days)

d. Maximum handling loss of 0.2 % at port.

AB

ST

RA

CT

Techno-Commercial Analysis of Importing Indonesian Coal for Krishnapatnam Ultra Mega Power Plant 6 X 660 MW

K

Mr. Manoj Vyas - MBA Power Management

Shri. Anil Kumar – Project Guide, Senior Analyst.

NPTI Faridabad (Under Ministry of Power, Govt. Of India)

manojvyas.ee@gmail.com

Coal Linkages & Coal Markets

AUSTRALIA

INDEX

Price(fob) US$ (4 Aug-2008)

GCV(Kcal/Kg)

Time In Delivery(Days)

Indonesia

• Indonesia is world’s no .1 thermal coal producer

of coal resources and 18.5 bn tons of

reserves are present in the South Sumatra

• RCRPL has acquired Srivijaya Bintangtiga Energy, Bryayan Bintangtiga Energy and Sugico

Pendragon Energy in the

hectares.

• The coal from the mines would be supplied to Reliance Power’s 4,000

Power Project at Krishnapatnam in Andhra Pradesh and also to the Shahapur power project

in Maharashtra

• Reliance has acquired mines with reserves of 2 billion to

linked model

• Since the mines are located in the South Sumatra region which is closer to India's east coast,

shipping time will be cut down by two days

• Reliance plans to build infrastruc

• The three mines acquired by Reliance Power in Indonesia have coal reserves valued at

about Rs 20,000 crore

• There are 2 coal markets in world Atlantic & Pacific.

• The coal can be purchased on contract basis & spot market

basis.

• Types of coal are hard & soft on the availability basis.

• Hard & soft coal be further bifurcated into coking (for iron &

steel manufacturing) & non-coking

generation).

AUSTRALIA SOUTH AFRICA INDONESIA

NEWC RB

160 155.13

6300 6000 4200

17.42 13.35 7.50

no .1 thermal coal producer. Indonesia has an estimated amount of 90 bn

of coal resources and 18.5 bn tons of coal reserves. More than 64% More than 64% of country’s coal

reserves are present in the South Sumatra.

RCRPL has acquired Srivijaya Bintangtiga Energy, Bryayan Bintangtiga Energy and Sugico

Pendragon Energy in the South Sumatra area of Indonesia spread over an area of 40,000

The coal from the mines would be supplied to Reliance Power’s 4,000-

Power Project at Krishnapatnam in Andhra Pradesh and also to the Shahapur power project

mines with reserves of 2 billion tonnes on a risk

Since the mines are located in the South Sumatra region which is closer to India's east coast,

shipping time will be cut down by two days

Reliance plans to build infrastructure, including a 100-kilometre railway line

The three mines acquired by Reliance Power in Indonesia have coal reserves valued at

Atlantic

South Africa

Columbia

There are 2 coal markets in world Atlantic & Pacific.

The coal can be purchased on contract basis & spot market

& soft on the availability basis.

Hard & soft coal be further bifurcated into coking (for iron &

coking coal (for power

1%South sumatra

east kalimantan

riau

south kalimantan

others

INDONESIA

ICI

50

4200

7.50

imated amount of 90 bn tons

More than 64% of country’s coal

RCRPL has acquired Srivijaya Bintangtiga Energy, Bryayan Bintangtiga Energy and Sugico

spread over an area of 40,000

-MW Ultra Mega

Power Project at Krishnapatnam in Andhra Pradesh and also to the Shahapur power project

nnes on a risk-free production-

Since the mines are located in the South Sumatra region which is closer to India's east coast,

railway line

The three mines acquired by Reliance Power in Indonesia have coal reserves valued at

Atlantic

Africa

Columbia

Pacific

Indonesia

Australia

China

sumatra

kalimantan

kalimantan

Coal Analysis

There are 3 types of coal analysis:

a. Qualitative : proximate analysis & ultimate analysis

b. Quantitative: coal consumption on hourly, daily, monthly & annual basis.

c. Cost: among Australia, South Africa & Indonesia as per there coal indices .

Ship scheduling

Cycle time 1+5.50+1+1+5.50=14days

No.of available days 320

No.of voyages 320/14=23

Qty per vessel(175 DWT) CAPESIZE 87500 GRT approx

Annual capacity 87500 X 23=2 MT

Annual capacity of 8 vessels 16 MTPA

The requirement of 15.33 MTPA of the KUMPP can be met with ease by above method.

GCV of Coal (designed) 4290 Kcal/Kg

Specific coal consumption 0.5244 kg/kwhr

Hourly consumption of coal(6X 660MW) 1750 Te

Daily coal consumption @85% PLF 4200 Te

Annual coal requirement @85 % PLF 15.33 MTPA

Description

quality

GCV(GAR)

Kcal/kg

Price(US $) as

on

06-june-08

TM(GAR)% Ash(GAR)% Sulphur%

ICI-1 6500 120.36 12 12 1

ICI-2 5800 95.17 18 10 0.8

ICI-3 5000 75.58 30 8 0.6

Reliance coal

ICI-4

4290 50 33.30 2.60 .24

Port nameDistance

(Km)Speed (Kts)

Sea time

(days)

Port time

(days)

Total

delivery

time

Departure

(including 1

day at

loading port)

Arrival

Tarah coal

terminal,

Indonesia

3667 15 5.50 2 7.5015-8-2008

7 hrs

20-8-2008

23:32hrs

Richards bay

port, SA7569 15 11.35 2 13.35

15-8-2008

7 hrs

27-8-2008

15:27 hrs

New castle

port,

Australia

10281 15 15.42 2 17.4215-8-2008 7

hrs

30-8-2008

17 hrs

Landed Cost of Indonesian coal

Landed cost consist = FOB ($ 50) + freight rates + inland handling charges at Krishnapatnam port.

= CIF + inland handling charges at Krishnapatnam

Data for calculating landed cost :

a) Cost of coal at Indonesian coal = Rs. 2000 @$ 50 /T ($ 1= Rs. 40)

b) quantity of coal imported form Indonesia through 175000 DWT vessel

c) rail distance (in km) for carrying coal from Indonesian Mine end to Indonesian Port

d) transportation cost of coal/tonne/km

e) coal handling charges /tonne at Indonesian Port

f) Sea - route Distance (in Km.)

g) transportation cost of coal/tonne/km

h) coal handling charges /tonne at Krishnapatnam Port

Options for sourcing coal

There are 3 options for sourcing coal:

a. Port > conveyer> project site

b. Mid sea Anchorage >

c. Mid sea anchorage >

Landed Cost of Indonesian coal

+ freight rates + inland handling charges at Krishnapatnam port.

handling charges at Krishnapatnam port = $ 70.4

Cost of coal at Indonesian coal = Rs. 2000 @$ 50 /T ($ 1= Rs. 40)

quantity of coal imported form Indonesia through 175000 DWT vessel = 87,500 T

distance (in km) for carrying coal from Indonesian Mine end to Indonesian Port

portation cost of coal/tonne/km= Rs.1 /Km

coal handling charges /tonne at Indonesian Port = Rs. 320

route Distance (in Km.) = 3667 Km

rtation cost of coal/tonne/km (through sea)= Rs. .30

coal handling charges /tonne at Krishnapatnam Port = Rs. 259

There are 3 options for sourcing coal:

conveyer> project site

id sea Anchorage > canal system > project site

Mid sea anchorage > captive port > conveyer > project site

+ freight rates + inland handling charges at Krishnapatnam port.

= 87,500 T

distance (in km) for carrying coal from Indonesian Mine end to Indonesian Port =100 Km

PDCA Cycle

• Plan : To procure best quality coal at cheaper rates

• Do : search various locations , supply chain, logistics & risk analysis

• Act : efficient power at cost - effective rates

• Check: Bottlenecks, cycle time, escalations, requirement

Questions

1. What is supercritical technology and what is the significance of it in case of UMPP & coal

consumption?

2. What is coal linkage and how it is different from captive coal mines?

3. How many coal linkages have been notified so far?

4. How ship scheduling has been carried out in this case?

5. What would be the landed cost in this case and how it is calculated?

6. Which is best option for sourcing coal & why?

7. What are INCO-TERMS? Differentiate between those which have been used here.

8. How many types of vessels are there in world for transporting coal? Name few with their

capacities.

9. What will be the landed cost if reliance would have purchased its mine in Kalimantan, the

place where TATA has acquired mines?

10. Calculate the price escalation as per CERC guidelines for importing coal for 25 yrs for

KUMPP.

11. Why china has stopped exporting coal?

12. What are the main reasons for increase in freight rates & coal demand?

13. What are various factors affecting global FOB coal prices?

14. Is there any risk in Indonesian mines? Discuss.

15. Name Indonesian coal price index. Name some international coal price indices .Why

Indonesia has formed its own coal price indices?

16. Why Indonesian mines for Krishnapatnam UMPP?

17. Is there any potential for sequestration of carbon-dioxide at Krishnapatnam UMMP?

18. COAL is providing enhanced security for power plants. Why?

Bibliography

1. www.mjunction.com

2. www.coal.nic.in

3. www.infraline.com

4. www.ausraliancoal.com

5. www.argus.com

6. www.globalcoal.com

7. www.plats.com

8. www.mccloskey.com

9. www.barleyjonker.com

10. www.coalindoenergy.com

Manoj Vyas- MBA (Power Management)

Shri. Anil Kumar- Project Guide (Senior Analyst)

NPTI – Faridabad