Power trading in India refers to the buying and selling of electricity between different power producers, consumers, and traders. It is a mechanism that enables efficient utilization of available power resources and balancing of demand and supply in the electricity market.
Power trading in India is regulated by the Central Electricity Regulatory Commission (CERC) and the Power Exchange India Limited (PXIL). The CERC formulates regulations and guidelines for power trading, while the PXIL provides the platform for participants to trade electricity.
The power trading market in India operates through two modes: bilateral trading and through power exchanges. Bilateral trading involves direct agreements between power producers and consumers, where they negotiate and enter into contracts for the sale and purchase of electricity. This mode allows participants to customize contracts based on their requirements and negotiate prices.
Power exchanges act as intermediaries by providing an electronic platform for participants to buy and sell electricity on a daily or hourly basis. These exchanges enable transparent and competitive trading, as prices are determined through the mechanism of market forces. The two major power exchanges in India are the Indian Energy Exchange (IEX) and the PXIL.
Power trading offers several benefits, such as:
- Market Efficiency: Power trading allows for efficient utilization of power resources by enabling surplus power to be sold and deficit power to be purchased, ensuring a balance between demand and supply.
- Price Discovery: Through power exchanges, participants can discover market-based prices for electricity, which helps in promoting competition and reducing dependence on fixed tariffs.
- Flexibility: Power trading provides flexibility to power producers and consumers to enter into short-term or long-term contracts based on their requirements, thereby hedging against price fluctuations and uncertainties in the market.
- Renewable Energy Integration: Power trading facilitates the integration of renewable energy sources into the grid by enabling renewable power generators to sell excess generation and utilities to meet their renewable purchase obligations.
EKI Power Trading Private Limited Will Be Helpful In Following Ways:
1. TRANSITION FROM COST BASED RETRUNS TO MARKET BASED RETURNS
2. CREATING "VALUE" OF POWER -MARKET BASED PROCE DISCOVERY OF POWER
3. OPTIMAL UTILIZATION OF GENERATION CAPAPCITY- SHORT TERM TRADING
Details of Power Trading Application
EKI Power Trading Private Limited has made an application under sub-section (1) of Section 15 of the Electricity Act, 2003 for grant of Category- IV license for inter State trading in electricity in all regions across India before the Central Electricity Regulatory Commission, New Delhi. The same can be downloaded from below link: