Power exchange launches longer duration products
The Power Exchange India Ltd (PXIL) has recently launched its longer duration power products for the Indian Power Market at a function in Mumbai. These ‘Weekly’ and ‘Day-Ahead Contingency (DAC)’ products will enable the market players in the Indian power market to buy and sell electricity up to a month in advance. This is expected to help the power sector players in taking decision with a more organized and planned view of their portfolio positions and pricing.
These products would also greatly facilitate the power procurement process of the utilities and would be operated through the bilateral open access system. PXIL would manage the counter-party risk on both sides of the trade thereby mitigating the credit risk.
Speaking on the occasion, Bharat Singh Solanki, Union Minister of State for Power, said the power exchanges would give boost to investment in the power sector in the country. “The Power exchanges are a part of development strategy of the Government to carry on market reforms and build nationwide support of infrastructure for providing market access. This strategy will also encourage power companies to come up with more surplus emergent power capacities and also drive new investments to meet India’s growing power requirement,” he said.
The Minister also stressed that a variety of products on the power exchanges will help achieve grid stability. “Power exchanges will enable the distribution companies to achieve a better balance between demand and generation on a day ahead basis. This is going to be helpful in stabilizing the grid frequency and reducing overdrawal from the grid,” he said.
The minister however clarified that no existing Power Purchase Agreement (PPA) will be re-opened for market development; hence power exchanges would have to harness new sources of supply to increase their volume. The new power supply, he said, would stabilize the power prices in the country.