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The Central Electricity Regulatory Commission (CERC) has selected through bidding process Deloitte Touche Tohmatsu India Pvt Ltd to review the functioning of the Indian Energy Exchange Ltd (IEX) and KPMG Advisory Services Pvt Ltd for the Power Exchange India Ltd (PXIL).
The period of the review will be FY 2012- 14.
CERC says such a review, which is being carried out for the first time since both the exchanges became operational in 2010, is necessary to ascertain that they are complying with the provisions of the Power Market Regulations 2010.
IEX clocks a daily turn over of 80 million units while 2 million units by PXIL. Both exchanges offer product in the day ahead market and in the term ahead market the contracts up to 11 days are traded. Besides, renewable energy certificates are also traded on these two exchanges.
According to CERC, the purpose of the review is to check the compliance of key regulations, robustness of the operational processes, risk management measures in place to ensure business continuity and safeguarding of interest of various stakeholders
IEX spokesperson said ''The proposed review is as per the provisions of the Power Market Regulations 2010 of CERC. The order mentions the extensive scope of the review and we look forward to help the Deloitte Touche Tohmatsu India Pvt Ltd.''
Further, PXIL CEO and MD MG Raoot also welcomed CERC's decision saying the review will ensure the prudent governance of the exchanges.''
Moreover, as per the CERC's mandate the Deloitte and KPMG will carry out detailed examination of the records of IEX and PXIL to assess the business processes and analyze data to verify the efficacy of the bid and offer matching process and compliance with regulations.
This apart, the review will be done of clearing and settlement process and all monetary transactions with a view to ensure that there are adequate safeguards against any default in payment and also adherence to pay in - payout timelines in transactions.
