Future of the third proposed exchange - National Power Exchange - remains uncertain with NTPC walking out of it. NHPC, Power Finance Corp (PFC) and Tata Consulting Services are the other members of the proposed exchange that was expected to begin operations this fiscal.
An official close to the development said NTPC has conveyed its willingness to quit the proposed exchange to other members. The company has cited changes in market conditions and power exchange regulations as the reason for backtracking from the project. NTPC board is likely to take a final call on the issue in its ensuing board meeting on December 28.
Power Exchange Market Regulations, 2010, specified by the Central Electricity Regulatory Exchange (CERC), bar participating members of an exchange from holding more than 5% equity. State electricity regulators' reluctance to give large industrial consumers the right to purchase power from exchanges is also an obstacle in smooth functioning of power exchanges.
Jayant Deo, advisor, India Energy Exchange (IEX), says: "The Indian power exchange market is awaiting various reforms and has not developed since open access to large consumers is yet to be implemented."
Currently, Financial Technologies-promoted IEX owns about 93% market share, while Power Exchange India, jointly promoted by National Stock Exchange and National Commodity & Derivatives Exchange, owns the rest.
Source- Economic Times