The Indian Energy Exchange, also referred to as IEX, reported a year-on-year decline of 1.7% in electricity volume traded on the exchange at 7.57 billion units (BU) in April, even as power demand in the country rose to record highs amid rising temperature.
India’s power demand hit an all-time high of 207.1 gigawatts (GW) on April 29, driven by the increase in demand from households amid heatwaves and a pick-up in industrial demand. States have scrambled to meet the demand, resorting to power cuts in parts.
According to the power demand data published by the National Load Dispatch Center, the energy consumption in April was 133 BU, up 11% on year. The exchange said that the volumes declined in March due to power supply constraints which also led to high clearing prices across all the market segments.
“The power supply side constraints reflected across the market segments on the exchange. In the day-ahead and real-time market combined, the total buy bids at 21,996 MU almost three times of the sell bids at 7,010 MU while the cleared volume was at 5,818 MU. This situation also led to an increase in the price of power at IEX, both in the conventional as well as the green markets,” the exchange said.
IEX said that of the total volume of 7.57 BU traded on the exchange in the month, 6.99 BU was in the conventional power market, 336 million units (MU) came from the green power market, while 249 MU or 2.49 lakh certificates) were traded in the Renewable Energy Certificate (REC) Market.
In March, prices in the short term market soared due to shortage of power supply as many power plants were low on coal stocks even as demand rose, the Central Electricity Regulatory Commission (CERC) stepped in on April 1, and asked electricity exchanges to cap prices at Rs 12 per unit in the day-ahead market.
Industry players said that the cap on the power price may have impacted the volume of electricity traded in the day-ahead market. In an interview with Moneycontrol on May 4, JSW Energy Ltd’s Joint Managing Director and Chief Executive Officer Prashant Jain said that the cap on the short-term prices was a “bit unfair” as the coal prices remained high and there is no support when the power prices fall significantly.
IEX said the Day-Ahead Market volume declined to 4.11 BU in April from 5.86 BU reported a year ago. The average monthly market clearing price was Rs 10.06 per unit in the month, up 172% on year.
The Real-Time Electricity Market (RTM) achieved 1.70 BU volume achieving a significant 16% year-on-year growth with the average monthly price at Rs 9.55 per unit. The highest single-day volume of 98.97 MU was achieved on April 30. During the month, 576 participants transacted on the exchange’s RTM market.
The Term-Ahead Market (TAM) comprising intra-day, contingency, daily and weekly contracts traded 1.17 BU in April, up 236% on year.
The Green Day-Ahead Market achieved 215 MU volume with the weighted average price of Rs 9.29 per unit and saw participation from 175 participants during the month. While the Green Term-Ahead Market achieved 121 MU volume and recorded participation from 46 market participants. The average monthly price for Solar was Rs 7.79 per unit while the average monthly price for non-solar was Rs 11.41 per unit.
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