CERC extends price cap on power exchanges till Dec 2022 amid rising demand

In view of power demand rising in the coming months, the Central Electricity Regulatory Commission (CERC) has extended the cap on spot power prices till December 2022. 

The maximum ceiling price that can be quoted at the power exhanges is Rs 12 per, according to the original order of CERC in June.  

The Commission had directed the powee exchanges in June to keep the range of prices from Rs 0/kWh to Rs12/kWh in Day Ahead Market (DAM), GDAM, RTM, Intra-day, Day Ahead Contingency and Term-Ahead (including Green TAM) contracts.

The move was in line with the coal shortage in the country leading to power crisis in states. To deter the power sellers taking advantage of the situation and inflating the sale prices, the Commission capped the ceiling tariff of the spot market. 

The cap was extended till September earlier. 

The Commission in its note said, it is expected that despite the fall in temperature, high demand for electricity particularly from household and industrial consumers is likely to continue over the next few months mainly due to festive season, and pressure emanating from lighting and heating load. Moreover, agricultural load will persist over the next few months on account of harvesting of kharif crops and sowing of winter crops, it said. 

"the Commission hereby directs all the operational Power Exchanges that for the period from 1st October, 2022 till 31st December, 2022 they shall continue to operate their software in such a way that members can quote price in the range of Rs 0/kWh to Rs.l12/kWh in DAM (including GDAM), RTM, Intra-day, Day Ahead Contingency and Term-Ahead (including GTAM) Contracts," CERC said in its order. 

It also said, though domestic coal stock is well positioned as compared to last year’s period from Oct’21 to Dec’21 but it is expected that generation from hydro and wind would start decreasing and will exert pressure on coal stock.