147 MU of Solar Traded at an Average Price of ₹3.56kWh at IEX in August 2021 (1)

The Indian Energy Exchange (IEX) traded 413 million units (MU) of renewable energy in August 2021, a 43% month-over-month (MoM) decline compared to 726 MU in the previous month.

However, the exchange saw an all-time high trade volume of 9.53 billion units (BU) of energy during the month, with a 74% year-over-year (YoY) growth. Energy consumption increased 17% YoY to 129.51 BU in the month. In addition, peak power demand in August 2021 reached 196 GW, with a 17 % YoY growth.

Green Term-Ahead Market

In August 2021, the green market segment traded 147 MU of solar energy and 266 MU of non-solar energy.

The market saw an average price of ₹3.56 (~$0.049)/kWh for solar power and ₹4.85 (~$0.066)/kWh for non-solar power, while the overall average price stood at ₹4.21 (~$0.058)/kWh.

On August 21, 2021, the green market segment completed one year and has cumulatively traded 2,744 MU over the year. Of this, 1,267 MU was traded in the solar segment and 1,477 MU in the non-solar segment. In the first year, the average price discovered at IEX for solar energy was ₹3.48/kWh and ₹4.06/kWh for non-solar energy. In the first year, Power Company  Karnataka Limited emerged as the top seller, and Vedanta Limited was the top buyer in the Green Market.

In August, 43 DISCOMs participated in power trading, including West Bengal, Bihar, Haryana, Telangana, Karnataka, Uttar Pradesh, Goa, Maharashtra, Punjab, Daman & Diu, Assam, and Tamil Nadu, among others. The number of participants was 51 in the previous month.

Head and senior vice president – business development, IEX, Rohit Bajaj, said, “The wind season in India’s wind-rich western and southern state starts in April, peaks around July, and then diminishes in September. In this fiscal year, a fully operational market at the peak of the wind season significantly helped utilities. With the wind session gradually receding, the market has seen a correction in the volume.”

Commenting on the forecast for upcoming months and quarters, Bajaj said, “We are upbeat about the growth prospect of the power market going forward. Demand growth is expected to continue, which would help power markets to grow further. We are also expected to introduce longer-duration contracts across the power as well as green markets.

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

In August 2021, the day-ahead market traded 6.64 BU volume at an average monthly price of ₹5.06 (~$0.069)/kWh, compared to 4.23 BU with an average monthly price of ₹2.95 (~$0.040)/kWh in the previous month.

The term-ahead market comprising contingency, intra-day, daily, and weekly contracts traded 617 MU during August 2021 and recorded a 13.82% month-over-month decline compared to 716 MU in July 2021.

Meanwhile, the real-time electricity market traded 1.85 BU at an average monthly price of ₹4.64 (~$0.063)/kW in August 2021. The trade witnessed a 116% YoY growth and 16.4% MoM increase compared to 1.59 BU in July 2021.

On the increase in exchange power prices, Bajaj said, “Growth in the economic and industrial activities led to increased demand for power. However, the supply-side constraints such as the high cost of imported coal and liquified natural gas (LNG) as well as lower wind power generation led to the increase in the discovered electricity prices in the day-ahead and real-time electricity market.”

Renewable Energy Certificates

The Renewable Energy Certificates trading session scheduled on August 25, 2021, was canceled due to a stay order from Appellate Tribunal for Electricity in response to the petitions filed by the Green Energy Association.