Hindustan Power Exchange Commences Operations

Highlights :

  • To initially offer Term Ahead Market (TAM), Green Term Ahead Market (GTAM) and Renewable Energy Certificates (REC)
  • HPX to be powered by same technology that makes BSE the fastest exchange globally
  • On Day 1 of operations, Hindustan Power Exchange Ltd has 40 participants
Hindustan Power Exchange Commences Operations

India formally welcomed it’s third power exchange on June 6, as Hindustan Power Exchange Ltd. (HPX), promoted by PTC India Ltd, Bombay Stock Exchange, and ICICI Bank, commenced operations after receiving all necessary approvals from Central Electricity Regulatory Commission. Backed by the latest technology and a series of innovative features, the exchange promises to offer speed, transparency, and better price discovery in the execution of trades. The exchange will initially offer trading in Contingency contracts, Green Contingency contracts, and Renewable Energy Certificates. It will steadily increase its product portfolio and provide a wide range of contracts to address the demand of different segments of the electricity market.

The power exchange has been some time in the making, going through over 3 years of approvals and preparations before launch. SaurEnergy had confirmed it’s imminent launch in our story last week.

Speaking on the launch, Akhilesh Awasthy, COO, HPX said, “The need for a third power exchange has been felt for quite some time now by the buyers and sellers for optimized price discovery and better efficiency in power purchase. HPX will be a seamless platform that has been built on the same technology, which makes Bombay Stock Exchange the fastest exchange in the world. The matching engine of the exchange is procured from one of the best technology providers in the world, which is also the technology provider for power exchanges in Europe. We will also gain from the significant experience of our promoters, who are leaders in their respective areas of operations.”

“Almost 90% of India’s electricity is traded via bilateral contracts lasting for 20 years or more between power generation companies and state utilities. These contracts do not provide the flexibility to sector participants to take advantage of market conditions at different times. Power Exchanges provide the market participants a platform with multiple avenues for buying-selling of power and hence manage their power portfolios efficiently. The introduction of HPX will give a definite push to the development and progress of spot trading in electricity,” he added.

Samir Patil, CBO, BSE said, “Hindustan Power Exchange(HPX) has been envisaged to promote market efficiency through advanced technology and to maximize value for the power market. The cutting-edge technology solutions, efficient price mechanism and the quality of service offered at HPX, would act as the differentiator in the Indian Power Market. With the technology set to be one of the key point-of-difference in the Indian Power Market, BSE looks forward in carving its footprint in the sector, thereby paving the way for a technology-led efficient power market through HPX.”

The exchange joins market leader Indian Energy Exchange (IEX), which has gone from strength to strength particularly in the past 2 years with the addition of many new contracts and innovations like cross border trading.

With a national target of 25% of energy trading through power exchanges by 2030, the market would seem tp be big enough for all three exchanges to operate and serve the needs of the market.

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