Hindustan Power Exchange Gains Share In Contingency Trade, Aims Other Segments
The power exchange has cumulatively traded 500 million units between July 6 and Sept. 1.
Hindustan Power Exchange Ltd., which commenced operations a couple of months back, has gained market share in contingency trade and is planning to start trade in other categories in the next fortnight.
The exchange has done a cumulative trade of 500 million units between July 6 and Sept. 1, Akhilesh Awasthy, chief operating officer of HPX told BQ Prime. That accounts for 20% of the overall contingency market share.
Currently involved only in contingency trade, it expects volumes in other platforms of ‘day ahead market’, ‘green day ahead market’ and the ‘real time market’ to start in the next 10-15 days, Awasthy said.
“We target our exchange price to become the reference price for trade in power. It will happen once we achieve the 20-30% market share in other segments as well.”
Green day ahead market will see significant movement as many corporates have taken pledge to buy only green energy. They participate in different segments through long-term contracts and if there is any shortfall they buy on exchanges too, Awasthy said.
“However, there are chances that ultimately both these markets will merge with the increase in adoption of storage technologies, since the end product delivered to customers is same.”
Liquidity
Better technology, improved services, and lower transaction costs, according to Awasthy, are some of the methods that will help the company to create a space in the power exchange business and attract liquidity. Although, there are various methods to bring liquidity to the exchanges, association with a particular company or group of companies is an important way forward, he said.
“We feel our current shareholders who transact 35-40% of the volumes in power market may progressively move to HPX,” Awasthy said.
Power market entities—generators and distribution companies—currently hold around 35% in HPX, which, he said, is a big advantage. The regulatory provisions allow an exchange to sell up to 49% of its equity.
Besides PTC India, BSE and ICICI Bank—the promoters of the company—other equity holders in the exchange are the power generation companies such as Jindal Power, Greenko Group, Satluj Jal Vidyut Nigam Ltd., Manikaran Power Ltd. the Sanjeev Goenka Group, and some state distribution companies of Haryana and West Bengal, said Awasthy.