IEX June Update- Prices Hold Steady As Demand Rises

Indian Energy Exchange (IEX), India’s premier electricity exchange, achieved electricity volume of 10,185 MU in June’24, marking a 24.7% year on year increase. The total monthly volume including certificates at 10,677 MU, increased 19.4% on year-on-year basis.

For the first quarter of the fiscal year 2025, IEX achieved electricity volume of 28,178 MU, an increase of 19% YoY basis. Total volume for the quarter including certificates was at 30,354 MU, up 20.8% from Q1FY’24.

According to government data published in June 2024, the country’s energy consumption reached 152.4 BUs, representing 8.9% increase year-on-year.

Hot weather conditions led to an unprecedented surge in electricity demand during the first quarter of this financial year. The country’s energy consumption of 452 BUs in Q1FY‘25 was 11.2% higher compared to Q1FY’24. During the quarter, the country’s peak demand reached 250 GW, surpassing the previous high of 243 GW recorded in September last year. Proactive measures taken by the government and the regulators, including the sale of surplus un-requisitioned power on power exchanges, increased fuel supply and ensuring higher availability of generating units led to an increased sell liquidity on the exchanges which kept the prices under control on exchanges. Therefore, despite the increase in the electricity consumption, the market clearing price in Day Ahead Market during June ‘24 was Rs. 5.40/unit, similar as last year, however it was lower by more than 20% as compared to prices discovered under bilateral contracts.

ELECTRICITY MARKET: DAY- AHEAD, TERM- AHEAD & REAL-TIME MARKET

The Day-Ahead Market (DAM) volume increased to 4,849 MU in June’24, from 4,103 MU in June’23, registering an increase of 18.2 % YoY. The DAM segment registered total volumes of 13,336 MU during Q1FY ’25, a marginal increase of 6.7% over Q1FY’24

The Real-Time Electricity Market (RTM) volume increased to 3,213 MU in June ‘24, from 2,675 MU in June’23, registering an increase of 20.1% YoY. The RTM segment registered volume of 9,193 MU during Q1FY’25, increasing 26.8% over Q1FY’24

Day Ahead Contingency and Term-Ahead Market (TAM), comprising of contingency, daily & weekly and monthly contracts up to 3 months, traded 1,378 MU during June’24, higher by 23.3 % on YoY basis. The total volume on the segment during the quarter was 3,875 MU, growth of 28.4% over Q1 FY’24.

GREEN MARKET: GREEN DAY-AHEAD & GREEN TERM-AHEAD MARKET

IEX Green Market, comprising the Green Day-Ahead and Green Term-Ahead Market segments, achieved 744 MU volume during June’24 as compared to 272 MU in June’23, registering an increase of 173.4% YoY. During Q1FY’25, the segment achieved volume of 1,768 MU, growth of 94.3 % over Q1 FY’24.

The Green Day-Ahead Market (G-DAM) achieved 680 MU volume during June ’24 with a weighted average price of Rs 4.14 per unit, as compared to 166 MU in June’23, registering an increase of 309.5% YoY. During Q1FY’25, the segment achieved volume of 1,616 MU, growth of 208.4% over Q1 FY’24.

The Green Term-Ahead Market (G-TAM) achieved 64 MU volume in June ’24 with average monthly price of Non-Solar- Rs 8.88/unit. During Q1FY’25, the segment achieved volume of 152 MU. This can be expected to drop going ahead as the monsoon supports faster recovery of hydropower generation.

RENEWABLE ENERGY CERTIFICATE MARKET (REC MARKET)

A total of 4.39 lac RECs (equivalent to 439 MU) were traded in the trading sessions held on 12th June’24 and 26th June’24, at a clearing price of Rs. 150/REC and Rs. 140/REC respectively. A total of 21.12 lac RECs (equivalent to 2,112 MU) were traded during Q1FY’25.

Rs 140/ REC is the lowest ever price discovered of REC in a trading session since inception.

The next REC trading sessions at the Exchange are scheduled on 10^th July’24 and 31^st July’24.

ENERGY SAVING CERTIFICATES (ESCERTS)

During June’24, 52,756 ESCerts (equivalent to 53 MU) were traded on IEX, at the floor price of Rs. 2,165 per ESCert. A total of 63,273 ESCerts (equivalent to 63 MU) were traded during Q1FY’25