‘Trading volume growing at 36% annually’
How is the trend in power market?
The Indian power market has changed significantly over the past few years. This is primarily due to factors such as the emergence of competitive bidding, growth of bilateral trading and introduction of power exchanges. The long-term market, which had traditionally operated under the cost-plus regime, is now defined by the new tariff-based competitive bidding (case-1 and case-2) process.
The volume of power sold through inter-state trading licensees has increased from 12 billion units (2.16% of total generation) in 2004-05 to 59 billion units (11.54% of total generation) up to October 2011, representing more than four-fold growth in seven years. During the current year, the transactions comprise about 88.5% through long-term, 8.2% through trading (6.4% bilateral and 1.8% power exchange) and 3.3% through balancing market.
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