CERC Grants Extra Time For Power Exchanges For Settlements

The Central Electricity Regulatory Commission (CERC), in its latest order, extended the time period to one year for the power exchanges to carry out the Clearing and Settlement as per the Payment and Settlement Systems Act (PSSA), 2007.

As per CERC (Power Market) Regulations 2021, these power exchanges that were granted registration by the Commission before the date of coming into force of these regulations were required to carry out the clearing and settlement as per the PSSA 2007. 

PSSA 2007 talked about the payment and settlement-related activities of the exchanges (excluding stock exchanges), which would be under the purview of the Reserve Bank of India (RBI). The CERC earlier had granted one year time period to the power exchanges to align their clearing and settlement systems under PSSA 2007. It also asked the CERC staff to examine the issue and hold consultations with the RBO to create a roadmap.

However, the CERC said that although the Commission and RBI had held consultations, but it would need some extra time before the matter could be forwarded to the Ministry of Finance. Meanwhile, the power exchanges also requested the CERC to extend the deadlines. 

“In view of the above, the Commission, in terms of the provisions of Regulation 27(1) of the PMR 2021, accords approval for a one-year extension w.e.f. 15.08.2023, to the Power Exchanges to align their Clearing and Settlement systems to the provisions of the PSSA 2007. The Commission further directs the staff of the Commission to resolve the matter expeditiously in consultation with the RBI and take the required steps in a time-bound manner,” the CERC said in its order.

CERC took the case on a suo motto mode and passed the order accordingly, allowing the power exchanges additional time to settle the issue. The CERC in 2021 came up with its CERC (Power Market) Regulations 2021 on August 15, 2021, and repealed the existing Power Market Regulations of 2010.