IEX Introduces Green Term Ahead Market, Invites Comments from Stakeholders

The Central Electricity Regulatory Commission (CERC) has ordered the Indian Energy Exchange (IEX) to give wide publicity to Green Term Ahead Market (GTAM) contracts by uploading it on its website and invite comments from all stakeholders and public.

The CERC was hearing a petition filed by the IEX seeking approval for the introduction of GTAM (Renewable Energy) contract at the power exchange under the CERC (Power Market) Regulations, 2010.

In its petition, the IEX had requested the CERC to consider holding that the power brought in the proposed Green Contracts from the exchange will be eligible for renewable purchase obligation (RPO) compliance by obligated entities.

It had also requested the CERC to amend regulations required for the introduction of GTAM contracts on the exchange platform and to accord the approval to Schedule E (regarding the introduction of GTAM) to be incorporated in the business rules of IEX.

In its submissions, the IEX had stated that through GTAM, the generators would have an additional option to sell their green power, and the buyers will have an additional avenue to fulfill their RPO. Market signals will provide encouragement for new merchant capacity to come up.

The IEX had submitted that there are curtailments of renewable energy from generators in several states and such generators will be able to sell the surplus power in GTAM. This would address the concerns of the generators regarding uncertainties around the signing of long term PPAs and the associated issue of recovery of the cost of generation. Mercom has reported previously on how solar project developers in the country continue to face curtailment issues and when it comes to states like Tamil Nadu, Andhra Pradesh, Karnataka, among others, the issue of curtailment is more challenging.

According to the IEX, through GTAM, renewable energy generators will not feel the need for a long term tie-up of capacity in advance or depend on the conclusion of PPAs for project viability. GTAM will also encourage small participants like open access consumers to buy green power to meet their RPO compliance.

IEX Introduces Green Term Ahead Market, Invites Comments from Stakeholders

While going through the submissions, the CERC noted that the IEX had not explained the procedural aspects as to how the deviation in the renewable energy generation will be treated particularly in the context of fulfilling the RPO requirement by the buyer.

It also observed that the IEX had not obtained feedback from the stakeholders on the proposed GTAM contracts. It will be appropriate for the IEX first to seek stakeholder`s comments in a transparent manner.

The CERC has ordered the IEX to approach it after comments are received from the stakeholders along with the views of the IEX. A separate notice will be issued after the comments are received and reviewed. Mercom had previously reported IEX had also filed for Green DAM (GDAM), but the government had refused its request.

Recently, providing relief to renewable energy generators of both solar and non-solar projects who are a part of the renewable energy certificate mechanism, the CERC issued an order extending the validity of RECs which were due to expire between April 1, 2019, and October 31, 2019.

Saumy Prateek Saumy is a senior staff reporter with MercomIndia.com covering business and energy news since 2016. Prior to Mercom, Saumy was a copy editor at Thomson Reuters. Saumy earned his Bachelors Degree in Journalism & Mass Communication from the Manipal Institute of Communication at Manipal University. More articles from Saumy Prateek.