Conventional wire-based transmission of electricity requires intensive co-ordination between energy producers, energy suppliers and energy buyers. An organised electronic exchange can help in bringing efficiencies in the process.
Here is something connected to this I wrote for the magazine I work for:
Power-full potential
Electricity producers and users are keenly watching the impact of the operationalising of the two spot power exchanges in the country—Indian Energy Exchange (IEX) and Power Exchange of India (PXI).
IEX, promoted by Financial Technologies (India) and PTC India, was set up last year and got approval from Central Electricity Regulatory Commission (CERC) to commence operations on 9 June and trading started on 28 June. Between 10 mega watts per hour (MWh) and 50 MWh for an electricity supply period of around 2-3 hours have got intermittently traded per day in the first few days of trading on IEX.
PXI, promoted by National Stock Exchange and National Commodity & Derivatives Exchange, got in-principal approval from CERC last month. It has commenced membership subscription and is likely to go live in about three months.
Liquidity is unlikely to be high initially on both exchanges. "In the interim, liquidity would most likely be added by surpluses held by captives and the power exchanges will have a significant role to play in unlocking the same," says Rupa Devi Singh, CEO of PXI. "Capacity additions, removal of transmission constraints and distribution reforms can lead to multi-buyer multi-seller market."
Interesting times lie ahead for the power sector.
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