IEX Records Lowest Green Energy Trade in 2023 at 188 MU in October, 53% YoY Drop

The renewable energy units traded at the Indian Energy Exchange (IEX) in October 2023 dropped further to 188 million units (MU), the lowest recorded in 2023, a 53.35% year-over-year (YoY) and 18.26% month-on-month drop.

The renewable energy trade continues its downward trend at the IEX this year, with a ~50% YoY drop in the second quarter of the financial year 2023-24.

The Green Day-Ahead Market (GDAM) and Green Term-Ahead Market (GTAM) segments witnessed a surge in the weighted average prices during the month, causing a drop in trading volumes.

The GDAM traded 180.80 MU volume during the month, a 38.29% YoY drop and a 29% MoM increase. The weighted average price recorded in the segment was ₹6.37 (~$0.076)/kWh, up 58% YoY. The segment saw participation from 194 participants during the month, a sharp 73% drop from 721 participants in October 2022.

The GTAM achieved 7.23 MU, a 93.4% YoY, and a 92% MoM decline, primarily due to lower liquidity in the segment. The average monthly price of non-solar was recorded at ₹8.40 (~$0.101)/kWh.

According to Mercom sources, the decline in renewable energy trading was due to the lower generation from wind and hydropower sources due to the seasonal changes and flooding in most regions of the country. Also, with solar generation mostly tied up in long-term power purchase agreements, the market experienced a considerable drop in overall renewable energy trading.

The total electricity volume traded at the Exchange was recorded at 9,260 MU in October, a 21% YoY increase. The overall volume, including Renewable Energy Certificates Energy Saving Certificates, was 9,483 MU during the month, an 18% YoY increase.

According to GRID-INDIA, the country’s energy consumption reached 139 billion units during the month, a 22% YoY increase due to the surge in demand driven by increased electricity consumption, below-average rainfall in October, and a lower base from the same month last year.

The surge in electricity trade was primarily due to distribution companies actively purchasing power on the exchange to meet the increased demand.

Renewable Energy Certificate Market

A total of 217,000 renewable energy certificates (REC), equivalent to 217 MU, were traded during the two sessions on October 11 and October 23, 2023, at a clearing price of ₹380 (~$4.56) /REC and ₹420 (~$5.04) REC, respectively.

Early last month, the Central Electricity Regulatory Commission had ordered two REC trading sessions every month, the second and the last Wednesday of each month for the upcoming six months, starting October.

The next REC trading sessions are scheduled at the Exchange on November 8 and 29.

Energy Saving Certificate Market

A total of 5,814 energy-saving certificates (ESCert), equivalent to 5.8 MU, were traded at the IEX during October at a floor price of ₹1,840 (~$22.10) / ESCert.

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

The volume traded in the Day-Ahead Market (DAM) segment increased to 4,742 MU in October, an 8.3% YoY increase from 4,379 MU. The surge in demand pushed the DAM prices to ₹6.45 (~$0.077)/kWh, a 68% YoY increase on a lower base price.

The Real-Time Electricity Market (RTM) segment registered 2,402 MU volume, a 6.1% YoY from 2,265 MU.

The Day-Ahead Contingency and Term-Ahead Market (TAM) segments comprising contingency, daily, weekly, and monthly contracts up to three months traded 1,911 MU during the month, a 207.6% YoY increase from 621 MU.

IEX recorded a profit after tax of ₹865 million (~$10.39 million) for the second quarter of the financial year (FY) 2023-24, a 21.5% YoY increase from ₹712 million (~$8.55 million). The Exchange recorded an electricity trading volume of 26.35 billion units, a 15% YoY increase. The trading volume comprised 24.07 BU from the conventional power market and 747.64 MU from the green market segment.


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