The Indian Energy Exchange’s (IEX) profit after tax (PAT) demonstrated an uptrend, with an 18.9% year-over-year (YoY) increase, soaring to ₹918 million (~$11 million) in the third quarter (Q3) of the financial year (FY) 2023-24 from ₹772 million (~$9.2 million).

The company’s total trading volumes surged by 16.8%, reaching 28.3 billion units (BU) compared to 24.2 BU in the same period last year.

The growth was accompanied by a 20.4% YoY increase in revenue, rising from ₹1.17 billion (~$ 14.07 million) in Q3 FY 23 to ₹1.41 billion (~$16.9 million) in Q3 FY 24.

For the first nine months (9M) of the year, IEX recorded ₹2.54 billion (~$30.5 million) of PAT, a YoY increase of 16.5%. The revenue for the period stood at ₹4.02 billion ($48.3 million), a 16.5% YoY increase from ₹3.45 billion ($41.5 million).

Operational Highlights

During the quarter, IEX recorded a trading volume of 28.3 BU, with 25.9 BU attributed to the conventional power market segment and an additional 0.4 BU from the green market segment.

The company facilitated the trading of 2.03 million certificates during this period.

In the power sector, October saw a peak power demand of 221 GW, and electricity consumption during Q3 FY’24 increased by 10% YoY, reaching approximately 380 BUs.

The improved supply scenario resulted in increased sell liquidity since November 2023. Sell bids in collective auctions rose by 25% YoY in November 2023 and 18% YoY in December 2023, leading to a softening of prices on the exchange.

The average market clearing price in the Day-Ahead Market (DAM) segment during Q3 FY 24 was ₹5.00 (~$0.060)/unit, compared to ₹5.80 (~$0.069)/unit in Q2 FY’24. Increased electricity consumption coupled with an easing supply-side led to a surge in the volumes of electricity traded on the Exchange.

The company said that positive regulatory and policy developments during the quarter, including the revised Indian Electricity Grid Code and the Sharing of Inter-State Transmission Charges Regulations, are expected to enhance the sell liquidity on Exchanges further, resulting in a potential decline in power prices.

IEX traded 232 MU of green energy in December 2023, a 38% YoY drop from 377 MU.

In Q2 FY24, it recorded a PAT of ₹865 million (~$10.39 million), a 21.5% YoY increase from ₹712 million (~$8.55 million).

Mercom recently reported on the downward trend of the green energy trade at the IEX and the reasons behind it.