Green Energy Trading Continues Fall on IEX In February

Highlights :

  • The impact of competition, and market tightening continues to show in IEX growth numbers.
  • The firm restarted trading in Ecerts during FEbruary
Green Energy Trading Continues Fall on IEX In February

In its February power trading release, the Indian Energy Exchange (IEX) has disclosed that it enabled trading for 341 million units (MU) of renewable energy in February 2023, a 2% decrease month-over-month (MoM) (347 MU) over the previous month and a 25% year-over-year (YoY) decrease.

The average daily trading volume on the exchange increased by 5% MoM. However, the overall trading volume decreased by 5% MoM due to fewer trading days in February.

Interestingly, its newest and most formidable competitor, HIndustan Power Exchange or HPX, promoted by PTC India Ltd, Bombay Stock Exchange, and ICICI Bank, has successfully crossed the milestone of 2.5 Billion Units of power traded within 8 months of its launch. HPX was able to cross this landmark with a rapid increase in trade volume across Contingency, Weekly, Monthly, and Long Duration Contracts (LDC) segments. The exchange recently concluded monthly long-duration contracts of 453.7 MU which will be delivered in the months of March and April 23 and is a part of the above volume.

HPX claims to have reached 2.5 BU within a short span of 67 days with a daily average volume of ~18 MU, post crossing the historic landmark of 1 BU, which happened within six months of its launch.

MEanwhile on IEX, the electricity trading volume was 7,673 MU, which represented a decline of 6% YoY and a 7% MoM. The total trading volume was 8,200 MU, which marked a decline of 7% YoY.

Demand is expected to pick up as summer sets in, even as supply side pressures might reappear if coal supplies to thermal plants and other logistics challenges are not sorted out.

Green Market: Day-Ahead and Term-Ahead

The Green Day-Ahead Market (GDAM) traded 250 MU with a weighted average price of Rs 6.57 / kWh, up 4% MoM. The market saw participation from 203 entities during the month, with the highest number of participants in a single day at 159 on February 22, 2023.

The Green Term-Ahead Market (GTAM) traded 91 MU during the month. The average monthly price for non-solar was Rs 8.22/ kWh Rs 10.18 / kWh for hydropower.

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

In February, the DAM volume decreased by 5% MoM to 4,664 MU. The DAM volume was also down 17% YoY due to high prices caused by a constrained supply, which led to continued high spot e-auction coal prices.

The Real-Time Electricity Market achieved 1,714 MU during the month, registering a 10% YoY growth.  There were 722 participants in this segment.

The consistent growth of the real-time electricity market indicates the growing reliance on distribution utilities and industries to achieve the power demand-supply balancing in real-time most efficiently, IEX said.

The TAM, comprising intra-day, contingency, daily, weekly, and long-duration contracts, traded 954 MU during the month, an increase of 81% YoY and 5% MoM.

Renewable Energy Certificate Market

Energy saving certificates

After a 14 months break, trading resumed at IEX for energy-saving certificates (ESCerts) on February 14, 2023. During the month, nearly 154,000 ESCerts, equivalent to 154 MU, were traded on IEX, representing a 97% market share.

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