IEX Follows PXIL in Launching RTM for Electricity Transactions

IEX has today (June 1, 2020) launched the real-time electricity market (RTM) on its platform, to help utilities buy and sell power just an hour before the requirement.

Energy trading platform Indian Energy Exchange (IEX) has today launched the real-time electricity market (RTM) on its platform, a move that will help utilities buy and sell power just an hour before the requirement. The RTM enables consumers, including distribution companies (Discoms) and captive users, to buy power on exchanges just an hour before delivery.

The real time market is an endeavour by the regulator, Central Electricity Regulatory Commission (CERC), to make the power market dynamic by enabling trade in electricity through half-hourly auctions. There will be 48 auction sessions during the day with the delivery of power within one hour of the closure of the bid session.

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According to the statement issued by the firm, the market will greatly aid the distribution utilities to manage power demand-supply variation and meet 24×7 power supply aspirations in the most flexible, efficient, and dynamic way. The utilities presently manage unplanned changes in schedule through the Deviation Settlement Mechanism and in the process, end up paying penalties. RTM will facilitate utilities to reduce dependency on deviation framework and save on the huge penalties. It will also support the grid operators to enhance the overall safety and security of the grid.

Further adding that with the fast-paced shift towards renewable energy, RTM will facilitate the distribution utilities to manage the challenge of intermittency associated with renewables. The market will help the utilities and system operators to forecast and schedule green energy in an effective way thereby supporting the national green energy aspirations towards building India as a sustainable green energy economy.

RTM would also provide an opportunity to generators to sell their unrequisitioned capacity thereby enabling efficient use of generation capacity

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“With the launch of RTM, the Indian energy markets are moving towards global standards of electricity trading and establishing the new energy order in the country. It will support the utilities in reducing dependence on grid deviation framework, of the order of 20 BU in the fiscal year 2020,” said Rajiv Srivastava, CEO & Managing Director, IEX Ltd, said.

“The primary purpose of the real-time market is to allow utilities to manage their power demand dynamically, save on huge deviation related penalties and integrate renewables in an effective way. The new market segment will foster greater flexibility, competition and efficiency in the electricity sector and address the emerging needs of the time,” he added.

IEX’s RTM is powered by the state-of-the-art technology and features double-sided closed auction to ensure transparency, competitive price discovery, and seamless trading experience to the market participants. The firm has already held several capacity building sessions involving the main beneficiaries of this new market segment including market participants, generation companies, and utilities. It has also successfully conducted various mock trading sessions and made an RTM tool available to help utilities leverage the market effectively.

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Recently, we had reported that Power Exchange India Ltd (PXIL), India’s other major energy trading platform would also be launching a real-time market for electricity transactions from June 1, 2020.

The entire transaction would be online and accessible from any part of the country, a PXIL statement said. As per the statement, this would be the first exchange contract that would allow even generators with long term power purchase agreements to participate in the exchange where they can sell their unrequisitioned surpluses. This would also allow renewable energy generators, who may have unanticipated surpluses to sell such supply and earn revenues and in turn obtain Renewable Energy Certificates (RECs) as well.