Extended monsoon and arrival of winters in parts of the country, the demand for electricity is witnessing downward trend on Indian Energy Exchange (IEX) where the total purchase bids received were close to 3596 million units (MUs) as against the total sale bids for 4453 MUs in October 2013. Higher supplies as against the demand made the day-ahead power market attractive for buyers with the average prices hovering around Rs 2.4 per unit in all parts of the country except South India.
On an overall basis, in terms of volume of power traded, the Northern and Southern regions were the net buyers, while the Eastern, Western and the North-Eastern regions were net sellers of power. On an average 85.30 MUs were cleared daily in October 2013 at the exchange.
"The overall demand for electricity in the country lowered owing to seasonal variations and intermittent precipitation in most parts of the country which is uncommon for this time of the year," read a media statement by IEX. It added that congestion played a major deterrent and the volume lost due to unavailability of transmission corridor doubled as compared to previous month and reached 442 MUs. "Evidently, the final cleared volume decreased to 2644.5 MUs in October'13 from 2852.8 MUs last month," said IEX.
Unavailability of transmission corridor for several days across the month saw the Southern region prices firm up further over the previous month. The corridor in South remain congested for 64% of the time and the average clearing price in Tamil Nadu and Kerala rose to Rs 5.74 per unit, highlighting an increase of 45%, whereas, the average prices in other parts were around Rs 4.15/kWh, a slight increase from the previous month. For the northern, eastern, western and north-eastern region the average price in the month of October 2013 were close to Rs 2.48, Rs 2.44, Rs 2.41 and Rs 2.44 respectively.
The buy volume from Punjab tripled as compared to last month as the transmission capacity previously tied up in short term bilateral contracts was relieved due to lowered agricultural demand with the paddy season coming to an end. As a result, corridor was available for transactions through the power exchange. However, the buy volume in other parts of North decreased which can be attributed to the overall decrease in demand with the onset of winter season.
The market once again maintained high liquidity through the month with an average of 1109 participants, up from 981 in the last month. On October 17, maximum participation of 1197 participants was observed.
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