The Indian Energy Exchange (IEX) traded 341 million units (MU) of renewable energy in February 2023, a 2% decrease month-over-month (MoM) compared to 347 MU traded in the previous month and a 25% year-over-year (YoY) decrease.

The average daily trading volume on the exchange increased by 5% MoM. However, the overall trading volume decreased by 5% MoM due to fewer trading days in February.

The electricity trading volume was 7,673 MU, which represented a decline of 6% YoY and a 7% MoM. The total trading volume was 8,200 MU, which marked a decline of 7% YoY.

High input costs continued to impact sell-side liquidity in February. However, there was an increase in demand for power due to several parts of the country experiencing unusually warm temperatures and sustained economic activity.

According to data released by the National Load Dispatch Center, the total energy produced in the country during February was 118 BU, representing a 9% YoY increase.

In the coming months, IEX expects that supply constraints will ease due to favorable policy and regulatory initiatives. These initiatives are expected to increase coal and gas-based generation, leading to higher liquidity on the exchange. This increased liquidity will likely provide cost-optimization opportunities for power distribution companies and open access consumers.

Green Market: Day-Ahead and Term-Ahead

The Green Day-Ahead Market (GDAM) traded 250 MU with a weighted average price of ₹6.57 ($0.080)/ kWh, up 4% MoM. The market saw participation from 203 entities during the month, with the highest number of participants in a single day at 159 on February 22, 2023.

The Green Term-Ahead Market (GTAM) traded 91 MU during the month. The average monthly price for non-solar was ₹8.22 ($0.10)/ kWh ₹10.18 ($0.12)/ kWh for hydropower.

Electricity Market: Day-Ahead, Term-Ahead, and Real-Time Market

In February, the DAM volume decreased by 5% MoM to 4,664 MU. The DAM volume was also down 17% YoY due to high prices caused by a constrained supply, which led to continued high spot e-auction coal prices.

The Real-Time Electricity Market achieved 1,714 MU during the month, registering a 10% YoY growth.  There were 722 participants in this segment.

The consistent growth of the real-time electricity market indicates the growing reliance on distribution utilities and industries to achieve the power demand-supply balancing in real-time most efficiently, IEX said.

The TAM, comprising intra-day, contingency, daily, weekly, and long-duration contracts, traded 954 MU during the month, an increase of 81% YoY and 5% MoM.

Renewable Energy Certificate Market

February saw 374,000 renewable energy certificates (REC)s cleared, registering a decrease of 5% MoM. The trading session witnessed a clearing price of ₹1,000 (~$12.24)/REC. The next REC trading session at the exchange is scheduled for March 29, 2023.

Energy saving certificates

After a hiatus of 14 months, IEX resumed trading energy-saving certificates (ESCerts) on February 14, 2023. During the month, nearly 154,000 ESCerts, equivalent to 154 MU, were traded on IEX, representing a 97% market share.

The exchange reported a 4.4% YoY decrease in profit after tax from ₹807 million (~$9.94 million) to ₹772 million (~$9.51 million) in the third quarter of the financial year 2023.