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Home News Power Sector News Power Exchange India Ltd. (PXIL) plans for 3 new products

Power Exchange India Ltd. (PXIL) plans for 3 new products

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PXILPower Exchange India Ltd. (PXIL), promoted jointly by NSE and NCDEX, has applied for three new products to the Central Electric Regulatory Commission (CERC).Once it receives approval, PXIL would be offering longer tenure products, intra-state products and contingency products in addition to present day-ahead products wherein physical delivery of power is made on the next of trading. While offering buyers and sellers of electricity with flexibility to trade for longer durations, these products are expected to bring in more liquidity to the power exchange. These products include longer tenure products as well as day ahead contingency products.

Under long tenure product sellers and buyers can be assured for generation and withdrawal of electricity on a week-ahead, 1st month ahead, 2nd month ahead and 3rd month ahead basis.

“Buyers and sellers would be in a better condition to mitigate the price risk as well as quantity risk of electricity over a longer tenure once these products are introduced” said Rupa Devi Singh, Managing Director & Chief Executive Officer, Power Exchange India Ltd; who feels that approval for the long tenure product is just around the corner and CERC is quite positive about it.

Through its intra-state products, PXIL aspires to develop the state-level power market in tandem with the national power market. The intra-state products involve 2-day-ahead transactions wherein a market participant can buy/sell power from/to other market participant within the same state. However, the unmatched trades would be brought to the national day-ahead market on next day. The process of approval for the intra-state products, which would be specific to various states, is separate from the other longer tenure products, which have a direct national footprint.

Further, the day-ahead-contingency (DAC) product has been designed by PXIL to provide buyers and sellers with additional opportunity to clear their volume at the end of the day after trading is over for the day-ahead market. According to PXIL authorities, given the perishable nature of electricity, surplus electricity which could not be traded during the earlier session can still be cleared if the sellers reduce their price bids and buyers requiring electricity match such prices.

This entire process is expected to lead to clearing more volume through a transparent and efficient mechanism; and thus is considered to be a key infrastructural support for the Indian power market running in overall deficit.

Pointed out Rupa Devi, “We want to play a significant role in developing a competitive power market in India. Power exchanges have been existing in developed foreign markets for last 15 odd years. In a power starved country, transparent mechanism and inclusive participation for electricity transactions, will certainly help in giving constructive shape to power market.”


Source- Economic Times
 

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