PEX seeks long-term trading contracts

Written by Sanjay Jog | Mumbai | Updated: Jan 7 2009, 05:55am hrs
NSE-NCDEX promoted Power Exchange India (PEX), which is currently involved in trading on a day ahead basis, in a petition before the Central Electricity Regulatory Commission (CERC) has asked for the introduction of producers such as week ahead, month ahead, two month ahead, three month ahead.

PEXs petition comes at a time when CERC in its interim order has recently allowed another power exchange, Indian Energy Exchange (IEX) to offer such products after amending business rules and talking to the central transmission utility, PowerGrid Corporation of India. PEXs initiative is crucial when there has been rising mismatch between demand and supply for power. The peaking deficit has risen to 14% while energy shortage is 8%. The timing of PEXs petition is also important when there is an ample power available during night while there is very little power available for trading during peak hours costing at Rs 9 per unit. CERC sources told FE , CERC has received PEXs petition. PEX has argued that natural market development cannot be blocked solely for protecting the interest of any particular segment. Day ahead as well as long-term contracts,that could be held in the power exchanges were left to be decided by the promoters of exchanges.