With a shortage of coal reported in several power plants amid rising electricity demand, power traded in the Indian Energy Exchange (IEX) touched an all-time high monthly volume of 9,538 million units (MU) in August. The volume traded in the month was about 74% higher than August last year, the IEX said in a statement. The highest electricity trading in IEX was done in the day-ahead market segment, scheduling 6,649 MU in the month, at an average rate of Rs 5.06/unit. This is comparable with the 4,484 MU traded through the day-ahead market in August 2020, at an average tariff of Rs 2.43/unit.
As FE recently reported, the price of power in the spot market touched an all-time high level of Rs 20/unit on August 29, a day after power supply shortage across the country was as high as 77.7 MU. The supply shortage on the same day in 2020 was 2.3 MU, and a paucity of 18.9 MU shortage was recorded on a corresponding day in 2019.
While the Rs 20/unit was discovered for one 15-minute time block on August 29, the average rate of power for the day at IEX was Rs 8.33/unit. The daily average spot power prices ranged between Rs 1.9/unit to Rs 3.8/unit in the first week of August, while in the second half of the month, it remained mostly above Rs 5/unit as coal supply issues became more prominent. Even supply from hydropower stations was less than expected, increasing demand from the spot market.
“On one hand, growth in the economic and industrial activities led to the increase in demand for power, on the other hand, the supply-side constraints such as high cost of imported coal and LNG as well as lower wind power generation led to the increase in the electricity prices discovered on the exchange,” the IEX statement said.
There were 43 market participants at IEX during the month, including discoms from West Bengal, Bihar, Haryana, Telangana, Karnataka, Uttar Pradesh, Maharashtra, Punjab, Assam and Tamil Nadu.