Supply constraints push average price up by 9% on IEX day-ahead market

Supply side constraints led to the average clearing price in the day-ahead market rising nine percent month-on-month (MoM) to Rs 5.63 in September, said IEX

New Delhi: Supply side constraints because of high prices of e-auction coal, imported coal and gas led to the average clearing price in the day-ahead market rising nine percent month-on-month (MoM) to Rs 5.63 in September, said IEX (Indian Energy Exchange). IEX achieved 8160 MU volume in September 2022, registering 5 percent MoM growth. This comprised 7,118 MU in the conventional power market, 454 MU in the Green Power Market, and 588 MU (5.88 lac Certificates) in the REC Market.

The total volume in September was lower by 8 percent on YoY basis while in the second quarter of the fiscal year 2023, the Exchange Market registered 23,115 MU volume, which was lower by 11 percent YoY across market segments. Cumulatively, the total volume traded in H1 FY2023 marginally declined by 1 percent over H1 FY22.

According to the power demand data published by the National Load Dispatch Center, the energy consumption at 127 BU saw 11 percent YoY growth during September. The national peak demand at 199 GW grew 10 percent YoY.

Electricity Market: Day-ahead, Term-ahead & Real-time market

High e-auction coal price and soaring imported coal prices and international LNG prices resulted in the market clearing price increasing by 9 percent on MoM basis to Rs 5.63 per unit as against Rs 5.17 per unit in August 2022. Despite this, the Day-Ahead Market volume increased from 3,529 MU in August to 4,050 MU in September, i.e 15 percent growth on MoM basis. However, high prices led to lower volume in Dayahead Market by 37 percent on YoY basis. In the second quarter of FY 2023, 11,095 MU volume was traded on the day-ahead market.

The Real-Time Electricity Market achieved 2,193 MU volume during the month, registering 19 percent YoY growth. The highest single-day volume of 104 MU was achieved on September 25. There were 614 participants in this segment during the month.

The Real-Time Market achieved a cumulative trade of 6,589 MU in Q2 FY2023, registering a robust 24 percent YoY growth. The consistent growth of real-time electricity market is an indication of growing reliance of the distribution utilities and industries to achieve power demand-supply balancing in real-time in the most efficient manner.

The Term-Ahead Market (TAM), comprising intra-day, contingency, daily and weekly contracts, and LDCs traded 875 MU during the month, growing by 21 percent on MoM and an astounding 721 percent on YoY basis.

Cumulatively for the quarter, TAM traded a total of 2,038 MU and registered a remarkable 30 percent YoY growth.

Green market

IEX Green Market, comprising the Green Day-Ahead and Green Term-Ahead Market segments, achieved 454 MU volume during September, with 4 percent MoM growth. For Q2 FY23, the market registered a cumulative trade of 1,478 MU, lower by 12 percent YoY.

The Green Day-Ahead Market achieved 324 MU volume with a weighted average price of Rs 5.42 per unit. The market saw participation from 747 market participants during the month, with the highest number of participants in a single day at 614 on September 5.

The Green Term-Ahead Market achieved 129 MU volume with an average monthly price of Rs 5.05 per unit for solar, Rs 6.15 per unit for non-solar.

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