Green Term-Ahead Market Trades Three Million Units in August 2020

REC trading currently on hold

September 4, 2020


The Indian Energy Exchange (IEX) has released the highlights of electricity trading on the platform during August 2020.

The trading in the Green Term-Ahead Market (GTAM) commenced on August 21, 2020, at the exchange. GTAM witnessed an encouraging response since its launch and has registered trade of three million units (MU) in the first 11 days. Presently, the trade-in intraday and day-ahead contracts in both solar and non-solar categories are live while the trading and daily and weekly contracts will commence shortly.

In all, 38 investors participated in the new market segment, with the highest number of participants on a single day being 20. The key participants included distribution utilities of Haryana, Daman and Diu, Dadra and Nagar Haveli, Calcutta Electric Supply Corporation (CESC), Tata Power Distribution Corporation, and open access consumers such as Amplus Green Power Pvt. Ltd, Jindal Stainless Ltd, Dalmia Cement, CESC, amongst others.

Meanwhile, the Renewable Energy Certificate (REC) trading session, which was scheduled on August 26, 2020, was put on hold due to the stay order from Appellate Tribunal for Electricity (APTEL).

The stay was in response to the petitions filed by a few renewable energy associations against the Central Electricity Regulatory Commission’s (CERC) order dated June 2020 regarding a revision in the floor and forbearance prices of RECs.

The electricity market traded 5,467 MU in August 2020, witnessing a 1% increase over the volume traded in August 2019. The national peak demand in the same period saw a 6% YoY decline while the energy consumption fell 2% in August 2020, according to the data issued by the national load despatch center (NLDC).

According to IEX, the distribution utilities from states such as the southern, western, and northern states continued to leverage the exchange market to meet their short-term electricity requirements.  “Moreover, as the COVID-19 restrictions ease, industries have been procuring power at attractive prices which have been facilitating the revival of industrial growth,” IEX’s statement noted.

The day-ahead market traded 4,484 MU during the month, with the average market clearing price at ₹2.43 (~$0.03307)/kWh.

The price saw a significant 27% YoY decline over ₹3.32 (~$0.04518)/kWh in August 2019. The attractive prices made electricity procurement from the exchange an attractive proposition for both the distribution utilities and industries, yielding significant savings.

One Nation One Price prevailed during all 31 days of the month. At 115 MU, the trading in the term-ahead market (TAM) increased 97% month-over-month (MoM), indicating continued acceptance of TAM contracts by the distribution utilities for meeting their short-term power requirements.

The real-time electricity market registered a notable rise of 9% on an MoM basis with a total trade of 856 MU during August. This is the highest monthly volume achieved in real-time trade so far since its launch in June 2020. According to IEX, it accomplished a cumulative trade of 2,157 MU in the first three months.

With 242 customers participating during the month, the real-time market continues to see adequate availability of power with sell bids volume at about 2.5 times that of buy bids.

The day-ahead market sees adequate availability of power with high sell-side liquidity. The total sell bids at 10,123 MU were twice of the buy bids at 5,081 MU.

Rahul is a staff reporter at Mercom India. Before entering the world of renewables, Rahul was head of the Gujarat bureau for The Quint. He has also worked for DNA Ahmedabad and Ahmedabad Mirror. Hailing from a banking and finance background, Rahul has also worked for JP Morgan Chase and State Bank of India. More articles from Rahul Nair.