IEX gains as total electricity market trades rise in June

Indian Energy Exchange (IEX) gained 3.14% to Rs 193.75 after the electricity market at IEX witnessed a total trade of 4790 MU in June 2020, recording a 5% year-on-year increase.

The total electricity market trade rose in June despite the national peak demand registering a 10% YoY decline during the month.

IEX said increased economic activity and easing of the lockdown restrictions in most parts of the country coupled with peaking summers contributed to national peak demand at 165 GW and energy consumed at 107 BU, according to data released by NLDC.

The Day-Ahead Market (DAM) traded 4174 MU and witnessed high sell side liquidity in the month, with total sell bids at 10164 MU being close to 1.5X the buy bids at 4661 MU. The average market clearing price during the month was at Rs 2.35 per unit registered a whopping 29% year on year decline over a price of Rs 3.32 in June 2019.

IEX said that the increased availability of power and attractive prices in the market ensured that the industries as well as the distribution utilities continue to have access to lower electricity prices leading to greater savings as well as assisting them in building the much needed financial liquidity which is critical at this hour. IEX further added that the open access volume in June witnessed 30% m-o-m increase.

IEX's real-time market received an overwhelming response from the participants and in its first month. The market attracted trade volume of 515.5 MU comprising over 10% of the total volume traded on IEX. The average monthly market clearing price stood at Rs 2.22 per unit for real-time market alone. A total of 237 customers participated in the new market segment during the first month with single day highest volume of 36.09 MU on 30 June 2020.

The Renewable Energy Certificate (REC) market at IEX saw a total trade of 2.29 lakh REC comprising 1,62,873 Non-Solar and 66,815 Solar RECs on 24 June 2020. The reduction in cleared volume both on monthly and yearly basis was clearly linked to the impending removal of floor price and lowering forbearance price to be effective from 1 July 2020, as per the recent regulations notified by CERC. For similar reasons, the market saw higher sell side liquidity with sell bid being 3.7x of the buy bids. The price for Solar RECs at Rs 1000 per REC decreased 50% from Rs 2,000 in May 2020 and the price for non-Solar RECs issued after 1.4.17, was at Rs 1,000 per REC.

IEX is the first and largest energy exchange in India providing a nationwide, automated trading platform for physical delivery of electricity, Renewable Energy Certificates (RECs) and ESCerts (Energy Saving Certificates).

On a consolidated basis, net profit jumped 20.5% to Rs 45.62 crore on 23% rise in net sales to Rs 69.44 crore in Q4 March 2020 over Q4 March 2019.

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