Power price falls 2% in June at IEX

The selling price of electricity dropped 2 per cent to Rs 2.56 per unit last month compared to May at the India Energy Exchange.
"The Market Clearing Price (MCP) of power in the IEX spot power market in June, 2015 was Rs 2.56 per unit, 2 per cent below the price in May 2015," IEX, which has over 95 per cent of market share of power trading, said in a press release.
MCP refers to the price discovered before accounting for congestion in inter-state transmission network.
The Area Clearing Price - discovered after accounting for congestion - also reduced in June across regions.

The Northern region was the only exception where the price increased by over 40 per cent over the previous month, mainly due to the unavailability of transmission corridor from the West or from the East. Therefore, all demand in the North had to be offset from generation within the region.
During June, the day-ahead spot market was predominantly a buyer's market with sell bids exceeding buy bids by almost 1.5 billion units. The total selling bids were for 4.6 billion units.

As regards volume, the daily average trade was almost 82 million units. Total cleared volume (of power) was 2.4 billion units, 15 per cent less than 2.9 billion units traded in May.

"The decrease in volume can be attributed to the low demand from the distribution utilities, and a significant part of the total volume traded was by the open access consumers," the statement said.
Lower prices in the region is fit case for Discoms to reduce their cost of power procurement by replacing higher marginal cost power. Few utilities resort to the above, however, still a lot of scope exists for utilities to reduce marginal cost of power purchase by purchasing more through the Exchange, it added.
The trend of Inter-State transmission congestion reversed in June since congestion towards Southern region eased out while towards the Northern region, corridor remained congested throughout the month. This resulted in higher price in North and lower price in South, an unusual pattern in the Day-Ahead Spot Market.

About 293 million were lost (in June) due to Inter-State transmission network congestion, a drastic 2.5 fold increase over the previous month when only 88 MUs were lost.
On an average, 1,028 participants traded in the day ahead spot market on a daily basis in June. Highest participation was recorded on June 2 when 1,136 participants traded at the Exchange.