Indian Energy Exchange Commences Trade On High Price Day Ahead Market

The HP-DAM segment was launched by Union Power Minister RK Singh during a webinar held on March 9, 2023.
<div class="paragraphs"><p>Electricity towers. (Source: <a href="">Andrey Metelev</a>/Unsplash)</p></div>
Electricity towers. (Source: Andrey Metelev/Unsplash)

Indian Energy Exchange on Friday said it has commenced trade in the High Price Day Ahead Market segment to provide a new avenue of high variable cost electricity generators like imported coal and gas-based projects.

"IEX, India’s premier energy exchange, today announced the commencement of trade in the High Price Day Ahead Market segment," an IEX statement said.

The Central Electricity Regulatory Commission in its order dated February 16, 2023, approved the introduction of HP-DAM in the Integrated Day Ahead Market segment in the power exchange.

This will provide a new avenue to the high variable cost generators which may not have been able to participate in DAM due to the existing price ceiling of Rs 12/kWh or unit, it explained.

The HP-DAM segment was launched by Union Power Minister RK Singh during a webinar held on March 9, 2023.

Speaking at the launch of HP-DAM, the minister said that it is a step towards reforming the evolving power market by meeting the current demand through optimum utilisation of the power generation capacity.

The HP-DAM will enable high-cost generators, falling under the category - Gas-based Power Plants using imported RLNG and Naphtha; imported coal-based power plants using imported coal; and battery energy storage systems - to participate in the market.

These generators will now be able to sell electricity on the IEX platform, with a price range of '0' to Rs 50/unit.

This unique segment will bring such capacity to the spot markets in a high-demand scenario.

SN Goel, Chairman and MD, IEX, said, "The High Price Day Ahead Market is an innovative initiative by the Ministry of Power and Regulator to bring additional power to the market by use of power generated from high-cost fuels, in the high demand period."

The price discovery for HP-DAM will be on Double-Sided Closed Auction, the same as for G-DAM, DAM and RTM (real-time market) segments.

The HP-DAM will function as part of the integrated DAM, with the sequential clearing of GDAM first, followed by DAM and finally HP-DAM.

Buyers and eligible sellers will have the option to transfer unselected bids in DAM to HP-DAM, with the flexibility to specify different prices and quantum for different segments at the time of bidding.

There will be a single window for bidding as per the existing timeline of 10 am to 12 noon, it stated.

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