The average price of electricity on the Indian Energy Exchange (IEX) rose 3 per cent on a m-o-m basis to ₹5.41 per unit as higher demand for power due to rising temperatures strengthened rates.
However, on an annual basis during April 2023, prices fell 46 per cent from ₹10 per unit in April 2022 due to improving supply side scenarios leading to increased liquidity, as well as cooler weather conditions. The energy met in the country during April stood at 130.57 billion units, declining 1.1 per cent y-o-y due to widespread rains.
“Sell-side liquidity also improved on the exchange due to government initiatives to ensure adequate power supply during this summer season, including gas-based thermal power that was made available on the exchange,” IEX said on Thursday.
While an increase in power demand is expected in the coming months, the supply side liquidity is likely to be maintained due to improved coal supply. This will lead to competitive prices and higher clearance for Discoms and open access consumers, it added.
In FY23, the average market clearing price on the day ahead market (DAM) segment at IEX was higher by 35 per cent on y-o-y basis at Rs 5.90 per unit due to higher demand for electricity amid lower supplies.
Another notable feature during April was the commencing of trade in the High Price DAM (HP-DAM) segment, with 193 megawatts hour (MWh) volume during the month. This segment allows high-cost generators, such as gas-based power generators, imported coal-based plants and battery-energy storage systems to sell electricity on the market.
Higher volumes traded
The Day-Ahead Market (DAM) volume increased to 4,332 million units (MU) in April 2023 from 3,993 MU last year, a growth of 8.5 per cent due to favourable prices. The average market clearing price was Rs 5.41 per kilowatt hour, which is significantly lower by 46 percent over the corresponding month last year.
The Real-Time Electricity Market (RTM) achieved 2,152 MU volume registering an impressive 26 per cent y-o-y growth. The consistent growth of RTM reflects its increasing acceptance among distribution utilities and industries to efficiently balance their power demand-supply on a real-time basis.
The Term-Ahead Market (TAM), comprising intra-day, contingency, daily and weekly contracts, and contracts up to 3 months, traded 842 MU during April 2023, which is lower by 28 per cent on an annual basis.