Renewable Energy Trading at IEX Grew by 517% YoY in FY 2021-22

The IEX has scheduled the next REC trading session for April 27


In the financial year (FY) 2021-2022, the Indian Energy Exchange (IEX) traded 4,854 million units (MU) of renewable energy, a 517% year-over-year (YoY) growth.

The energy trading in the newly launched Green Day-Ahead Market (GDAM) was 9.63% higher than in Green Term-Ahead Market (GTAM).

It achieved an all-time high volume of 102,035 MU in FY 2021-22, a 38% increase YoY. Electricity consumption rose by 8% with 1371.7 BU during the financial year. The peak power demand during the year grew by 5.5% with 200.5 GW.

In March 2022, 392 MU of renewable energy were traded, a 13% month-over-month (MoM) decrease compared to 453 MU traded in the previous month.

The Exchange traded 9.60 billion units (BU) of energy during the month, about 10% up compared to 8.76 BU in February. Energy consumption increased 19% with 126 BU in March compared to the preceding month. In March 2022, the peak power demand saw a marginal (3%) uptick MoM with 199.29 GW.

Green Market: Day-Ahead and Term-Ahead

IEX Green Market comprising the day-ahead and term-ahead segments, traded 392 MU volume during March.

The GDAM traded 205 MU of energy during the month with the weighted average price of ₹6.70 (~$0.089)/kWh. In March 2022, 173 participants took part in the trading.

GDAM traded 921 MU since its inception in October 2021.

The GDAM was introduced to provide additional sales avenues to existing renewable power projects that face payment risk with the distribution companies under the existing power purchase agreements or have surplus energy.

The GTAM traded 187 MU during the month with 40 participants. IEX said the average monthly price of solar energy stood at ₹5.64 (~$0.075)/kWh and non-solar energy at ₹5.08 (~$0.067)/kWh during the month.

In FY 2021-22, GTAM traded 3,933 MU, a 403% YoY growth.

The key distribution companies (DISCOMs) were from Delhi, Himachal Pradesh, Haryana, Telangana, Karnataka, Bihar, Uttarakhand, Daman & Diu, and several other industrial consumers participated in the trading.

Rohit Bajaj, Head of Business Development at IEX, said, “We have seen a minor reduction in renewable volume under Green Market (GDAM + GTAM) in March 2022 at the IEX platform. There has been no decrease in renewable energy generation in the country; however, due to an increase in power demand across States, the sell-side liquidity on the Exchange reduced during the month of March. ”

Electricity Market: Day-Ahead, Term-Ahead, Real-Time

In March 2022, the Day-Ahead Market traded 5.85 BU and registered a 4.4% month-over-month (MoM) growth. However, the average market clearing price increased by 85% MoM and 102% YoY to ₹8.23 (~$0.11)/kWh. The price increase was mainly due to the early onset of the summer season, leading to increased demand for power across all the States and low generation from the imported coal and gas-based generators due to record high imported coal and gas prices.

The Term-Ahead Market comprising intra-day, contingency, daily, and weekly contracts traded 823 MU, a YoY growth of 251%.

During the month, the Real-Time Electricity Market (RTM) traded 2.02 BU with a 43% YoY growth. The market achieved the highest single-day volume of 96.6 MU on March 25.

In FY 2021-2022, the conventional electricity market on the Exchange achieved 90,817 MU volume seeing 23% YoY growth.

Bajaj said, “Regarding the price increase, we are aware that the price is mainly a function of demand and supply dynamics. The power price increase in March was mainly on account of early onset of the summer season leading to increased demand for power across all the States and low generation from the imported coal and gas-based generators due to record high imported coal and gas prices.”

Renewable Energy Certificate Market

IEX traded 511,000 renewable energy certificates (RECs) in March 2021, including 259,000 non-solar RECs and 251,000 solar RECs. The exchange discovered a price of ₹2,250 (~$30) per certificate for solar RECs and ₹1,000 (~$13.21) per certificate for non-solar RECs. In FY 2021-2022, the REC market achieved 6.08 million RECs, equivalent to 6078 MU.

In FY 2021-22, 6.78 million RECs were traded at IEX, equivalent to 6,078 MU of renewable energy.

Energy Saving Certificates (ESCerts)

During FY 2022, 286,142 energy saving certificates equivalent to 286 MU were traded at the Exchange.