77
Mr. Bikram Singh Guram AVP (Business Dev.) , Indian Energy Exchange Department of Industrial and Management Engineering Indian Institute of Technology Kanpur 3 rd Capacity Building Programme for Officers of Electricity Regulatory Commissions 23 – 28 August, 2010 Power Market Scenario and Power Market Scenario and Functioning of Power Exchanges Functioning of Power Exchanges Forum of Regulators

Power Market Scenario and Functioning of Power … - Bikram Singh Guram - Power... · Power Market Scenario and Functioning of Power Exchanges Forum of Regulators. ... – JSL ‐

  • Upload
    lydan

  • View
    225

  • Download
    0

Embed Size (px)

Citation preview

Mr. Bikram Singh GuramAVP (Business Dev.) ,

Indian Energy Exchange

Department of Industrial and Management Engineering

Indian Institute of Technology Kanpur

3rd Capacity Building Programme for Officers of Electricity Regulatory Commissions

23 – 28 August, 2010

Power Market Scenario and Power Market Scenario and Functioning of Power ExchangesFunctioning of Power Exchanges

Forum of Regulators

IEX: Building Power Market for IndiaIEX: Building Power Market for India…Day Ahead Markety

Bikram SinghAVP – Business Developmentbikramsingh guram@iexindia com

www.iexindia.com

[email protected]

In this presentation …

Introduction to Power Market

Aspects of various PX model

Introduction to IEX

Products at IEX

www.iexindia.com

Power Markets

► A Transition » Vertically integrated monopoly to wholesale and retail competitiony g p y p

► The effect?

Effi i t li id d l t k t l» Efficient, liquid and complete marketplaces

» Increased private participation

» Organized marketplaces like power pools and power

exchanges

www.iexindia.com

Success Factors for Power Markets

► Open, free and competitive market

► Sufficient players on both supply and demand sides► Sufficient players on both supply and demand sides

► Trust in the physical reference on Exchange

W k bl l i l ti► Workable legislation

► Real-time market separated from day-ahead market

► Simple set of minimum rules

► Non-discriminatory access to transmission grid

► Price areas reflect physical network constraints

www.iexindia.com

Evolution of Electricity Market

1998…

1996..

2008

2001 20041…. 2004

www.iexindia.com

Aspects for Different PX/Pool ModelsTi iTiming sequence:It is defined in terms of scheduling and time units.

►Scheduling» Day Ahead Scheduling

NordPool: Day Ahead Scheduling ex-ante price settlement

» Real Time BalancingNEMMCO (Australia): Real-time trade and ex-post settlement.

►Scheduling period» Hourly Contracts

Nordpool, PJM (USA), PowerNext (France), OMEL (Spain), EEX

» Half hourly Contracts. NEMMCO (Australia), time-weighted average of six 5 minute intervals

www.iexindia.com

Market clearing

► Uniform pricing» Provides the same price for every accepted bid» Provides the same price for every accepted bid» Nordpool & IEX

►Discriminatory Pricing►Discriminatory Pricing» pay-as-bid pricing » BETTA (UK)

►Vickerey Auction» The buyer of the highest bid gets the electricity at the second

highest bid price g p» OMEL (Spain)

www.iexindia.com

Auction Rules

► On the basis of No of bidding sides:» Single-Sided Auction» Double-Sided Auction

► On the basis of bid disclosed► On the basis of bid disclosed» Closed Auction» Open Auction

► On the basis of Time Block» Hourly» Time Block( Base peak Off Peak)» Time Block( Base, peak, Off-Peak)

www.iexindia.com

Transmission Pricing

► Nodal Pricing» Price at each individual node is calculated» Price at each individual node is calculated » PJM, NZEM (New Zealand)

► Zonal pricing» Set price is used for every zone without inner

congestion» NEMMCO, Nordpool

www.iexindia.com

Aspects for Different PX/Pool ModelsTi iTiming sequence:It is defined in terms of scheduling and time units.

►Scheduling» Day Ahead Scheduling

NordPool: Day Ahead Scheduling ex-ante price settlement

» Real Time BalancingNEMMCO (Australia): Real-time trade and ex-post settlement.

►Scheduling period» Hourly Contracts

Nordpool, PJM (USA), PowerNext (France), OMEL (Spain), EEX

» Half hourly Contracts. NEMMCO (Australia), time-weighted average of six 5 minute intervals

www.iexindia.com

Market clearing

► Uniform pricing» Provides the same price for every accepted bid» Provides the same price for every accepted bid» Nordpool & IEX

►Discriminatory Pricing►Discriminatory Pricing» pay-as-bid pricing » BETTA (UK)

►Vickerey Auction» The buyer of the highest bid gets the electricity at the second

highest bid price g p» OMEL (Spain)

www.iexindia.com

Auction Rules

► On the basis of No of bidding sides:» Single-Sided Auction» Double-Sided Auction

► On the basis of bid disclosed► On the basis of bid disclosed» Closed Auction» Open Auction

► On the basis of Time Block» Hourly» Time Block( Base peak Off Peak)» Time Block( Base, peak, Off-Peak)

www.iexindia.com

Transmission Pricing

► Nodal Pricing» Price at each individual node is calculated» Price at each individual node is calculated » PJM, NZEM (New Zealand)

► Zonal pricing» Set price is used for every zone without inner

congestion» NEMMCO, Nordpool

www.iexindia.com

Monopoly……..Competitive Market

www.iexindia.com

Indian Power sector… History

First 5 Decades of 20th Century…• Private licensees

Post Independence (1947)p ( )

• State monopoly in Generation, Transmission & Distribution• Provinces optimized within own boundaries• Entry of Central Government Power Plants• Entry of Central Government Power Plants

Early 90’sEarly 90 s

• Difficult to provide budgetary support for Power Sector•The Law was amended for IPPsF il   f Si l  b   d l  ENRON

www.iexindia.com

• Failure of Single buyer model ­ ENRON

Evolving Industry Structure

No Competition• No choice• Government makes

decision

Generation Competition• Single buyer has choice

Wholesale Competition• Distribution/retail

companies have choice

Retail Competition• Consumers have choice

No Competition• No choice• Government makes

decision

Generation Competition• Single buyer has choice

Wholesale Competition• Distribution/retail

companies have choice

Retail Competition• Consumers have choice

G G G G G G G G G EG G G G G EGG G G G G G G G G EG G G G G EG

T T / SB T / SB T / MO T / MOT T / SB T / SB T / MO T / MO

D/R D/R D/RD/RD

R R R RD/R D/R D/RD/R

D

R R R R

Consumers Consumers Consumers ConsumersConsumersConsumers Consumers Consumers ConsumersConsumers

www.iexindia.com16

= Who has choice

MO = Market OperatorEG = Embedded Generator

= Who has choice

MO = Market OperatorEG = Embedded Generator

Indian Power Market

Long Term Power Purchase Agreements

Upto 25 Years

Medium Term3 months­ 3years

OTCLicensed traders (42)3 months 3years

Short-Term OTC  Intraday­ 3 months

Exchanges Intraday ­ 3 months

1. Intra­day2. DAM

h d l d h

3. DAC4. Daily5. Weekly

www.iexindia.com

Balancing Market Unscheduled Interchange

Real Time

E hExchanges are“one stop shop”

to buy and sell electricity for

Any hour of the dayAny day of the weekAny day of the week Any week of the month

www.iexindia.com

Who are we ?

PromotersPromoters

Joint Equity Partners: Jo t qu ty a t e s

Technology :

www.iexindia.com

Market Development Milestones

2005 IEX Conceptualized PXFor capacity addition

2006 •Created awareness among Stakeholdersacross the country

2007 • CERC issued guidelines for setting PX• IEX got in principle approval2008June 27Flawless Operations

ill d15th September’09 Term-ahead Marketh d•CERC approved commencement of

Day Ahead Market2008 2008June 27till date…15 September 09 Launched

Aug’ 2009 • CERC approves IEX Term-ahead Market

www.iexindia.com

What is IEX

Voluntary

On-line

National

Delivery…

National

Automated StandardisedContracts

•Spot•Intra-Day•Day-ahead

•Forwardk

Electronic

Central

•Weeks•Months

Counterparty

Exchange as Organized Marketplace Power-specific

www.iexindia.com

Exchange as Organized Marketplace Power specific

Day-ahead Market

www.iexindia.com

IEX IEX -- DAM Product DescriptionDAM Product Description

• Order Types:– Hourly or Portfolio Orders

• Min 1 hourMin 1 hour

• Different Price‐Quantity Pairs

• Partial Execution Possible

Bl k O d– Block Orders

• Consecutive hours during the same day– Customized block bid allowed

• Firm commitment to purchase or sell

• Order CharacteristicsSLDC Clearance should be ≥ 1 MW– SLDC Clearance should be ≥ 1 MW

– Minimum Order quantity can be less than 1 MW

– Minimum volume step: 0.1 MW

www.iexindia.com

– Minimum price step: Rs 1 per MWh ( 0.1p/kWh)

IEX - DAM Product DescriptionT di  A il bilit• Trading Availability– Every Calendar Day

• Order Entry / revise /cancel– Entry of orders on D‐1 from 10:00 hrs to 12:00 hrs related to Delivery Day (D day)  

• Contract– Clearing Price : Area Clearance Price– Cleared Volume – Total Contract Value:  Cleared Volume multiplied by ACP– Final settlement adjusted for any force majeure deviations 

• Delivery PointDelivery Point– Periphery of Regional Transmission System in which the grid‐connected  entity, is located 

www.iexindia.com

Time Line for scheduling of Collective Transaction

10:00 14:00 18:0012:00 13:00 15:00 17:30

Market P ti i t t

RLDCs/SLDCs to incorporate Collective Transactions in the Daily

NLDC to confirm acceptanceParticipants to

place their Bidsthe Daily Schedule

PX to send provisional unconstrained

NLDC to check for congestion. In case of congestion shall intimate PX

acceptance. PX to send files to SLDCs for scheduling

PX to send Scheduling Request to NLDC based on margin specified by NLDC

unconstrained solution to NLDC and flow on TS as informed by NLDC

intimate PX regarding to the period for congestion and available

www.iexindia.com

p yNLDC margins

Price Calculation Algorithm ….each hourPrice (Rs./kWh) 0 20 1 2 2.1 3 3.1 4 4.11.1 2.5

Portfolio A, MW 20 020 020

Portfolio B, MW 6060 2040 40 2040 4040

SUM, Purchase 120 100 80 80 60 60 40 40 202060

Portfolio C, MW 40 -400 -12020 0 -120-80 -81-60

SUM Sale

Price

SUM, Sale 0 0 -40 -120-120-80 -81-60

Net transaction 120 20 -100-80-20 -21100 80 80 -1000

2502505

SalePurchase

Rs/kWh

3

4

100

150

200

ice

($/M

Wh)

100

150

200

ice

($/M

Wh)

2

3

4

/kW

h 2.52.52.5

MCP:

/

MW40 80 120

2

MW 0

50

-150 -100 -50 0 50 100 150

Pri

0

50

-150 -100 -50 0 50 100 150

Pri

1Rs.

/

60

www.iexindia.com

MW balanceMW balance60

MCV (Market clearing volume):

Trader Station: Single Bid

www.iexindia.com

Trader Station: Block Bid

www.iexindia.com

Treatment of Losses

• Both Buyers and Sellers to absorb losses– Buyer

d l h C d P• draw less than Contracted Power(Contracted Power – losses)

– Seller• inject more than Contracted Power• inject more than Contracted Power(Contracted Power + Losses)

• Average Transmission Losses of the Region where the Entity isg g ygeographically located

• Additional Losses for Wheeling, if necessary– To be notified in advance by NLDCy– Only for Injection

www.iexindia.com

Treatment of Losses… for buyer

• NR (Regional) Loss: 6%• S1 (State) loss: 4.85 %

B  X bid  f  100    t it   ti   i l  i h• Buyer X bids for 100 mw at its respective regional periphery

Bid VolumeScheduled Drawal<  SLDC Cl

100 MW

NR S1 X

Bid Volume <= SLDC Clearance

100 MWat NR      

periphery 

Loss 6%

94 MWat S1     periphery  Loss 

4.85%

89.44 MW at Buyer End (Buyer)

www.iexindia.com

Maximum Bid= Volume in standing clearance + Regional & State losses

Treatment of Losses… for seller

• SR (Regional) Loss: 6%• A1 (State) loss: 4.85%• Seller Y bids for 100 mw at its respective regional periphery

Bid VolumeScheduled Generation <  SLDC Cl

SR A1Y

Bid Volume <= SLDC Clearance

Loss 

6%

111.14 MW Injected by 

seller at its  end

Loss 

4.85%

Y           (Seller)106 MW at state 

periphery 100 MW at regional periphery

www.iexindia.com

Maximum Bid= Volume in standing clearance – Regional & State losses

Congestion Management

www.iexindia.com

IEX Bid Areas

www.iexindia.com

CongestionSR WRSR WRS1

50 MWB1

50

B2150 MW

S240 MW

S350 MWB330 MWDeficit S1

80 MWB1

100 MWS2

120 MWS3

100 MWSurplus

50 MWRS 800050 MWRS 8500

150 MWRS 900040 MWRS 8500RS 750030 MWRS 7000100 MW

80 MWRS 9500100 MWRS 6000120 MWRS 8000100 MWRS 5500100 MW

B2150 MWS3

Required Flow

S1B1

50 MW

Rs 9/uS3

50 MWRs 7.5/u

S2

S2100 MWRs 5.5/u

100 MW

S150 MWRs 8/u

50 MWRS 8.5/u

S2 B1S1B3

S220 MWRs 8/u

www.iexindia.com

40 MWRs 8.5/u

100 MWRs 6/u

80 MWRs 9.5

B330 MWRs 7/u

CongestionSR WRSR WR

Deficit SurplusSurplusDeficit100 MW

Surplus100 MWSurplus20 MW

Lowest  Buyers getting rejected

20 MW

B2150 MWRS 9000S3 S2

Allowed Flow

Highest Seller getting rejectedLowest  Buyers getting rejected

S1

B150 MW

RS 9000S350 MWRS 7500

S2

S2100 MWRS 5500

20 MW

S150 MWRS 8000

RS 8500

S2 B1S1B3

S220 MWRS 8000

www.iexindia.com

40 MWRS 8500

100 MWRS 6000

80 MWRS 9500

B330 MWRS 7000

Risk Management System

D‐1 At 09:30 Hrs : Pre‐trade Margin Check. equal to the initial margins or average of last 7 days’ trading valueequal to the initial margins or average of last 7 days  trading value, whichever is more. 

D‐1 At 12:30 Hrs : Preliminary Obligation Margin CheckPreliminary Obligation =< Funds Available (incl initial margin)Preliminary Obligation =< Funds Available (incl initial margin)Block funds.D‐1 At 15:30 Hrs : Pay‐ins

At D+1 14:00 Hrs : Pay‐out. 

www.iexindia.com

Performance so far…

IEX won India Power Award for“ Best e-enabled consumer platform”

17th November,2009

www.iexindia.com

Over 2 years of Adequate Liquidity

•29 State Utility• 450+ Portfolios• 450+ Portfolios• 260+ Direct consumer• 286 participants on single dayCl d V l    11 72 Billi  U it• Cleared Volume : 11.72 Billion Units

• Trade Value: Rs 6,425 Crs• DAM Volume Record

54.16 MUs constrained (20th August’ 10)

www.iexindia.com

Participation at IEX

STATE No. of CPP's Open Access Industrial Consumers

Maharashtra 4 0

Rajasthan 7 17

Karnataka 7 0

Andhra Pradesh 5 17

Punjab 4 68

Orissa 1 2

Madhya Pradesh 9 3Madhya Pradesh 9 3

Chhattisgarh 31 0

Haryana 2 5

Tamilnadu  0 147

Gujarat 7 0

Arunachal Pradesh 0 2

www.iexindia.com

Total 80 261

Nationwide participation in Market…

State Utilities

Total Participants460

CPP

Green Power

Open Access consumer

www.iexindia.com

Recent Developments…

• Addition of Industrial Consumers (Buyers)

JSL (Haryana) 75 MW

PXIPXI

– JSL  (Haryana)‐ 75 MW

– RSWM (Gulabpura, Rishabhdev, Hamirgarh, Rajasthan) – 22.5 MW

DCM E Ltd (P j b) 10 MWIEX

PXI– DCM Engg. Ltd. (Punjab) – 10 MW

– Cheslind Textiles (TN) – 4 MW

IEX

– Sterlite Industries (TN) – 23 MW

• Largest 75 MW and smallest 1MW

www.iexindia.com

Increasing Participant

www.iexindia.com

IEX monthly Average Price

10 7812

IEX Monthly Average Spot Price

7.66 7.73 7.50 7.688.46

7.568.36

10.78

7.297.91

8

10

Rs/

kWh

6.145.62

6.42 6.21 6.41

4.674.08

4.54

3.142 78

3.18 3.24

5.76

4.52

3.43 3.594

6

e Pr

ice

in R

2.78

0

2

Aver

ag

Months

www.iexindia.com

MonthsMonthly Avg Price (Rs/kWh)

IEX Monthly Volume

www.iexindia.com

IEX hourly Price & Volume­June’10IEX Average Hourly MCV & MCP for June' 2010

10

1,300

1,400

IEX Average Hourly MCV & MCP for June 2010

7

8

9

1,000

1,100

1,200

,

kWh)

5

6

600

700

800

900

Pric

es (R

s/k

Volu

me

(MW

h)

2

3

4

300

400

500

600V

0

1

0

100

200

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

www.iexindia.com

Hours Avg MCV (MWh) (cleared) Avg MCP (Rs.kWh)

Prices for various time block­ June'10

6.00

Prices for various time block- Jun'10

Price in Rest of India and the congested region

4.00

5.00

Rs/

kWh)

g g

2.00

3.00

Pric

e (

0.00

1.00

www.iexindia.com

Time Blocks

IEX hourly Price & Volume­July’10

www.iexindia.com

Prices for various time block­ July’10

h f ( )Prices in the four regions (N,W,S,E)

www.iexindia.com

DAM Prices & Volume

www.iexindia.com

Membership

www.iexindia.com

IEX Membership CategoryP i t  M bProprietary Member

(right to trade and clear on its own account)Generator‐ Distribution licensees‐ IPPs ‐ CPP‐ MPPs –O A consumers

Professional

(trade and clear on behalf of its Clients)Clients

Grid Connected(t ade a d c ea o be a o ts C e ts)NO CREDIT /FINANCING

Electricity Traders

Grid ConnectedGenerator, Distribution 

licensees, IPPs, CPP, MPP, OA consumersElectricity Traders

(trade and clear on behalf of its Clients)

CREDIT /FINANCING

consumersTrader Client With valid PPA

RE Member(right to trade in Renewable Energy

RE ClientsRE Generator  Distribution 

www.iexindia.com

(right to trade in Renewable Energy Certificates on self account and on behalf of 

Clients)

RE Generator, Distribution licensees, CPP, OA consumers

Term Ahead MarketTerm Ahead Market

www.iexindia.com

Introducing A New Market Segment…

1) Weekly Contract

Week 1

Week 2

2) Daily Contract

Trading day  D2Trading day D­5

D3 D4 D5 D6 D7D1

3) Day­Ahead Contingency & Intra­day

Delivery dayDelivery day ‐1

DAM DAC Intra day

www.iexindia.com

DAM DAC Intra day

Types of Contracts

• Weekly and Daily– FBA  ‐‐ Firm Base  – 24 Hrs– FNT  ‐‐ Firm Night – 8 Hrs (0­7 & 23­24)– FDY  ‐‐ Firm Day – 11Hrs (7­18)FPK Firm Peak 5 Hrs (18 23)– FPK  ‐‐ Firm Peak – 5 Hrs (18­23)

• Day Ahead Contingency and Intra­Day• Day Ahead Contingency and Intra­Day– Hourly ( DAC‐24 hrs & Intraday‐18‐24)

Region Specific Contracts

www.iexindia.com

Trading of Weekly & Daily Contracts

SUNDAY MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY SATURDAY

1 2 3 4 5 6Weekly

7 8 9 10 11 12 13

14 15 16 17 18 19 20

Daily

21 22 23 24 25 26 27

28 29 30

www.iexindia.com

IEX Trading - Timeline

10.00 Hrs

13.00 Hrs

12.00 Hrs

15.00 Hrs

14.00 Hrs

17.00 Hrs

Market Close

11.30 Hrs 

Pre­Trade Session 

DAMClose Auction

Weekly (FBA,FNT,FDY,FPK)

Open Auction

Day­Ahead ContingencyCont. Trading

Daily ContractsCont. Trading 

Intra­Day MarketCont. Trading

www.iexindia.com

Treatment of Losses…TAM

• An Example: Seller in NR, Buyer in SR, FBA Contract of 100 MW at Seller’s State Periphery (Delivery Point).p y ( y )

State

Buyer  84.48 MW at Buyer 

NR

Loss 

SR

Loss 

ER

Loss 

State

Seller X

(Sell)103.09 MW at Seller 

Y

(Buy)100 MW at 96.5 MW at Region 

88 MW at State 

92.64 MW at Region 

4%at Buyer end3.5% 5%4%3%

(Sell) at Seller end

(Buy)State Periphery

Region Periphery

State Periphery

at Region Periphery

Contract Region(Delivery Point)

* d h d l f d

www.iexindia.com

* Loss and charge details are of indicative purposes

MATCHING OF BIDSOPEN UNIFORM AUCTION

www.iexindia.com

The SellersThe BuyersTrade MatchedSelected Sellers : S1,S2,S3,S4 (partial)Selected Buyers : B1,B2,B3,B4MCP :Rs 8000/MWh  Volume: 125 MW10 MW @ Rs 

S4 S5 S650 MW @ Rs 

5,50040 MW @ Rs 

7,00050 MW @ Rs 

8,000

50 MW @ Rs 9,000

50 MW @ Rs 10,000

6,000

S1 S2 S3 S4

B1B2

B3 B4B3 B4B6B5

B7

10 MW @ R  

40 MW @ Rs 9,000 50 MW @ Rs 

8,000

25 MW @ Rs 8,000

25 MW @ Rs 7,000

50 MW @ Rs 6,000

50 MW @ Rs 5 500

125

10 MW @ Rs 10,000

5,500

www.iexindia.com

MATCHING OF BIDSCONTINUOUS TRADING

www.iexindia.com

TWS ScreenPending Buy Order Pending Sell Order

Sell 15 MW @ RS 5500/MWhBuy 10 MW @ Rs 4500/MWh

Trading EngineTrading Engine

Buy 10 MWh @ RS 4500/MWh Sell 15 MWh @ RS 5500/MWh

Buy 10 MW @ Rs 4500/MWh Sell 15 MWh @ Rs 5500/MWh

www.iexindia.com

TWS ScreenPending Buy Order Pending Sell Order

Sell 15 MW @ Rs 5500/MWhBuy 10 MWh @ 4500Buy 10 MW @ RS 5000/MWh

Buy 10 MW @ RS 4500/MWh

Trading EngineTrading Engine

Buy 10 MW @ RS 5000/MWh

Buy 10 MW @ 5000/MWh

www.iexindia.com

TWS ScreenPending Buy Order Pending Sell Order

Sell 15 MWh @ 5500Buy 10 MWh @ 5000

Buy 10 MWh @ 4500

Sell 15 MWh @ 5500Sell 5 MW @ Rs 5000/MWhBuy 10 MW @ RS 4500/MWH

Trading EngineTrading Engine

Sell 15 MW @ Rs 5000/MWh

Sell 15 MWh @ 5500Sell 15 MW @ RS 5000/MWh

Trade 10 MW @ RS 5000/MWh Bid Modified

Sell 15 MWh @ 5500

www.iexindia.com

Risk Containment Measures

Initial Margin(Operational Limit)

5% of the trade, this need to be deposited in cash(Operational Limit)

B i  M i  *

deposited in cash

to be collected in trenches of 10% orBasis Margin *

V i i  M i  *

to be collected in trenches of 10% or 30% or 50% depending upon the contract.

ff h diff i i fVariation Margin * to offset the difference in prices of a contract arising out of the trading on different days.

Extreme Loss * To counter any unforeseen event

www.iexindia.com

* All the above mentioned margins can be deposited in form Cash , BG, FD and LC

TAM: Performance so far…Weekly Day­ahead Contingency

362,124 MWh 20,617 MWh

Renewable Energy CertificatesTotal Volume traded

390,699 MWh

Renewable Energy Certificates

Intraday Daily

www.iexindia.com

7,958 MWh ‐

Renewable Purchase ObligationsState 2010-11 2011-12 2011-13 Remarks

MP

Wind - 6% Wind - 6%

Draft Regulation, Biomass - 2% Biomass - 2% MP g ,

April 13 - 2010 Cogen & Others - 2% Cogen & Others - 2%

Total- 10% Total- 10%

Non-Solar - 5.75%% Non-Solar - 6.75% Non-Solar - 7.50%

Maharashtra Final Regulation, 2010 Solar - 0.25% Solar - 0.25% Solar - 0.5%

Total - 6% Total - 7% Total - 8%%

Non-Solar - 4.5% Non-Solar - 4.75% Non-Solar - 5.0%

Orissa Draft Regulation, March 16 - 2010 Solar - 0.25% Solar - 0.75% Solar - 1%

Total - 4.75% Total - 5.5% Total - 6%

Draft Regulation AprilTN Non-Solar-14% Draft Regulation April 28, 2010

UPNon-Solar - 3.75% Non-Solar - 4.5% Non-Solar - 5.0%

Draft Regulation 2010Solar - 0.25% Solar - 0.5% Solar - 1%

www.iexindia.com

UP 2010 Solar 0.25% Solar 0.5% Solar 1%

Total- 4% Total-5% Total- 6%

Introducing an another option… REC

Feed-in Tariff[State Regulated T iff]

REC Option

S l f El t i it Sale of electricity to

Tariff]

REC

Electricity Green Attributes

Sale of Electricity at Market Price in open market 

Sale of electricity to DISCOMs at State regulated tariff

REC [Solar & Non‐Solar]

Sell to DisComs at 

Sale of RECs at Power Exchange

* ‐Weighted Average Pooled Price at which distribution licensee has purchased electricity (including cost of self 

Price ≤ Pooled Cost of Power Purchase* 

www.iexindia.com

generation, long‐term and short term purchase) in the previous year, but excluding the cost of RE power purchase

KEY characteristics of RECParticipation Voluntary

REC Denomination 1 MWh

Validity 365 Days after issuancey y

Categories 1. Solar REC 2. Non-Solar REC

Trading Platform Power Exchanges only

B ki N t All dBanking Not Allowed

Borrowing Not Allowed

Transfer Type Single transfer only, repeated trade of the same certificate is

not possible

Penalty for Non-compliance ‘Forbearance’ Price (Maximum Price)Non-Solar (Rs. 3,900/REC), Solar (Rs. 17,000/REC)( , ), ( , )

Price Guarantee Through ‘Floor’ Price (Minimum Price)Non-Solar (Rs. 1500/REC), Solar (Rs. 12,000/REC)

Price Discovery Mechanism As per Power Exchanges’ Business Rules for REC

www.iexindia.com

Price Discovery Mechanism As per Power Exchanges Business Rules for REC

RECs Floor/Forbearance Price

Fl P i F b P iFloor Price Forbearance Price

Solar RECs Rs. 12,000/REC Rs. 17,000/REC

Non-Solar RECs Rs 1 500/REC Rs 3 900/RECNon-Solar RECs Rs. 1,500/REC Rs. 3,900/REC

1 REC is equivalent to1 MWh

www.iexindia.com

Key Stakeholders in REC Framework

NLDC – Central AgencyResponsible for registration, issuance of RECs, maintaining accounts settlements repository monitoring and such otheraccounts, settlements, repository, monitoring and such other functions incidental to the implementation of REC mechanism

State Nodal Agency - Accreditation Body An approving Authority which Checks RE generators against theirAn approving Authority which Checks RE generators against their eligibility criteria and the norms specified by MNRE

State Load Despatch Centres - Monitoring Body Verifies electricity generation from RE sources and notifies theVerifies electricity generation from RE sources and notifies the Central Agency

Power Exchange - Trading Platform Facilitates transactions [IEX]Facilitates transactions [IEX]

Compliance AuditorsMonitors effective compliance by RE producers

www.iexindia.com

Operational Framework of REC Mechanism

www.iexindia.com

Cleared volume : 600 RECs MCP: Rs 2200/REC

s 17

00

s 20

00

Rs

1500

Rs

3900

sell

@ R

s

Sell

@ R

s

EC S

ell @

RC

Buy

@ R

00 R

EC s

00 R

EC S

100

RE

100

REC 20 30

2200

600 REC Buy @ Rs 2200 200 REC Buy@ Rs 1700

www.iexindia.com

600

Schedule of Trade DaySchedule of Trade Day

Time on Trade DayTime on Trade Day DetailsDetailsTime on Trade DayTime on Trade Day DetailsDetailsPrePre‐‐trade Phase:trade Phase:By 12.00 HrsBy 12.00 Hrs ExchangeExchange toto checkcheck initialinitial marginmargin checkcheck forfor MembersMembers

( )( )Order Accumulation phase (Bidding)Order Accumulation phase (Bidding)13.00 Hrs to 15.00 Hrs13.00 Hrs to 15.00 Hrs OrderOrder AccumulationAccumulation

Order matching and trade Order matching and trade finalisationfinalisationBy 15.30 HrsBy 15.30 Hrs •• ExchangeExchange toto sendsend detailsdetails ofof maximummaximum offeroffer placedplaced byby SellersSellers toto CentralCentral AgencyAgency

By 16.00 HrsBy 16.00 Hrs •• CentralCentral AgencyAgency toto sendsend reportreport confirmingconfirming validvalid RECsRECs withwith EligibleEligible EntitiesEntities

By 16.30 HrsBy 16.30 Hrs •• FinalisationFinalisation ofof tradetrade resultsresults afterafter removalremoval ofof defaulters’defaulters’ ordersordersE hE h tt i fi f ti i tti i t b tb t t dt d ltlt•• ExchangeExchange toto informinform participantsparticipants aboutabout tradetrade resultsresults

By 17.00 HrsBy 17.00 Hrs •• ExchangeExchange toto informinform CentralCentral AgencyAgency thethe detailsdetails ofof buyersbuyers andand sellerssellers

Settlement PhaseSettlement PhaseBy 17 00 HrsBy 17 00 Hrs •• FilesFiles toto bebe sentsent byby ExchangeExchange toto banksbanks forfor actualactual debits/creditsdebits/credits (Pay(Pay‐‐inin && PayPay‐‐out)out)By 17.00 HrsBy 17.00 Hrs •• FilesFiles toto bebe sentsent byby ExchangeExchange toto banksbanks forfor actualactual debits/creditsdebits/credits (Pay(Pay inin && PayPay out)out)

By 11.00 Hrs (next bank By 11.00 Hrs (next bank working day)working day)

•• FilesFiles toto bebe sentsent byby ExchangeExchange toto banksbanks forfor actualactual creditscredits (Pay(Pay‐‐out)out)

Delivery PhaseDelivery Phase

www.iexindia.com

By 18.00 HrsBy 18.00 Hrs •• CentralCentral AgencyAgency toto extinguishextinguish RECsRECs inin Seller’sSeller’s AccountAccount

•• ExchangeExchange toto raiseraise invoicesinvoices toto eacheach participantparticipant asas proofproof ofof transfertransfer ofof RECsRECs..

Conclusion

Flexibility for obligatory entities to meet RPO requirements

St t h i li ibl l RE t ti l l t dStates having negligible or very low RE potential can also set and

meet targets for RPO compliance

REC trade through Power Exchanges would result into a better price

discovery and increased liquidity

Improved cash flow for RE producers

RECs pave the way for Greener India !

www.iexindia.com

IEX InitiativesContinuous communication with Users

IEX Daily SMS Service for

IEX Monthly Bulletin

IEX h lService for Trade Details IEX hourly

Trade Prices displayed ondisplayed on its website

www.iexindia.com

Thank You !!!Thank You !!!www.iexindia.comwww.iexindia.com

PromotersPromoters

Joint Equity Partners: Jo t qu ty a t e s

Technology :

www.iexindia.com