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Home News Power Sector News IEX approach CEA for week ahead and month ahead trading

IEX approach CEA for week ahead and month ahead trading

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Power Exchanges asks CERC for relaxation as they are fighting for survival in a power deficit market like IndiaIndian Energy Exchange (IEX), India's first power exchange  approached Central Electricity Regulatory Commission (CERC) for permiting them to facilitate sale-purchase of power on week and month ahead basis. Now, IEX trades less than 0.5% of the market and struggles for survival after launch of second power exchange- Power Exchange India Limited(PXI).

On 9th June 2008 CERC accorded approval to IEX to commence its operations and 27th June 2008, Indian Energy Exchange Ltd (IEX), India’s first-ever power exchange started functioning.The IEX at present, facilitates power transactions on day ahead basis, which means that power can be bought for the next day, only a day before. This results in some uncertainty since power availability keeps changing.

To make more business and more profits, IEX approached the CERC requesting permission for starting power transactions on week/month ahead basis.

The IEX has said in its petition that there were significant advantages of allowing power exchanges to facilitate week ahead/month ahead contracts for willing seller and purchaser. A licensed trader usually undertakes purchase and sale of electricity for a maximum period of one year to the minimum period of few hours. At present, there is no organised mechanism whereby one could sell electricity on a weekly or monthly basis.

The IEX said that it was also very difficult for a person having surplus electricity or a person who can release surplus electricity for a week or month to find a purchaser. The power exchange can offer such a facility.

“It is therefore of utmost importance that power exchange is developed to arrange for other contracts like week ahead or month ahead basis. This will facilitate more competition with more number of people participating in the sale and purchase of electricity,” the petition said.

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