www.powerexindia.com
Session 3
Advance Metering Infrastructure, Power Trading and Cloud Computing
Transmission, Distribution and Metering India
(Enabling Smart Grid & Smart Metering)
Nov 10, 2010
Mrs. Rupa Devi Singh, MD & CEO
Power Exchange India Limited
www.powerexindia.com
Power Exchange India Limited- Voluntary but Institutionally promoted
EQUITY PARTNERSCentral Government Entities State Government Entities Private power producers
Power Finance Corporation Limited
GUVNL JSW Energy Limited
MPPTCL Tata Power
WBSEDCL GMR Energy Limited
The foremost power sector organizations in India, partnering for a vibrant power market
PROMOTERSNational Stock Exchange
(NSE ) National Commodity and Derivatives Exchange
(NCDEX)
PXIL leverages on promoter and shareholder experience :- NSE -largest stock exchange in India and 3rd largest in the world
- Govt entities discharging the Universal service obligation - Leading Private producers in the country
www.powerexindia.com
Indian Power Sector
One of the largest interconnected power systems in the worldGeneration Capacity of 164,836 MW(Sep 2010)-800,000 GW by 2030Energy deficit of about -9.6% and peak demand deficit of -10.5% (Sep 2010)Predominant focus on fossil fuels, especially coal
Sour
ce: C
EA, N
LDC
*Defi
cit n
umbe
rs fo
r Jan
201
0
88.00%
6.00%
4.00%
2.00%Types of Transactions (Sep 2010)
Long Term PPAs
Bilateral Short Term
Balancing
PXs
www.powerexindia.com
Indian Power Sector -Installed Capacity
Installed Capacity as on September 2010 Installed Capacity-Fuel Mix
Source- CEA
Installed Capacity MWCoal 87944Gas 17374Diesel 1199Nuclear 4560Hydro 37329RES 16429Total 164835
www.powerexindia.com
Indian Power Sector
Demand – Supply Summary Forecasts
Xth Plan 2006-07
XIth Plan 2011-12
XIIth Plan 2016-17
690969
1392
624821
1098
Energy Requirements (in BU)Energy Availability* (in BU)
Xth Plan 2006-07
XIth Plan 2011-12
XIIth Plan 2016-17
100
153
218
96115
154
Peak Load (in GW)Peak Served* (in GW)
Even with higher rates (6% y-o-y) of capacity addition and energy generation, India would continue to remain a power deficit country
Source: CEA *Extrapolated by PXIL
www.powerexindia.com
India’s Projected Energy & Capacity requirements
XI Plan XII Plan XIII Plan XIV Plan XV Plan0
200
400
600
800
1000
1200
67 86119
150203220
306
425
575
778
78 104151
197
275233
337
488
685
960
8% Growth Rate
Cummulative Capacity @8% Growth rate
9% Growth Rate
Cummulative Capacity @9% Growth rate
GW
2007-122027-32
Immense task ahead in terms of capacity addition requirements
www.powerexindia.com
Electricity Act 2003- transition to a market
Development of a multi-buyer multi-seller market in powerCompulsory Unbundling of utilitiesComplete De-licensing of generation “Trading” of Electricity – a licensed activity
Provides Consumer level choice of supplierSeparation of “transmission ownership” and “system operation”Universal Open Access to transmission networks for all consumers over 1 MW
Robust Policy framework providing ground rules for competition National Electricity Policy detailing roadmap for development of markets - PXs Mandated Competitive procurement of power by uitilitiesGlobal competitive bidding for projects in transmission
A proactive approach for development of a market in renewables
Committed the Nation to Development of a Vibrant Market in Electricity
www.powerexindia.com
Indian Power Sector – Post Reforms Transition
MonopolyGovernment Ownership (Vertically integrated)
Public Corporation
Private Corporation
Purchasing Agency
Commercialization
Corporatization
Privatization
Competition
Wholesale Competition Retail Competition
Introduction of
Power Exchanges
www.powerexindia.com
Products
Sl. No.
Products Term / Duration
1 Day Ahead (10 AM-12 Noon)
For 24 Hrs the next day
2 Day-ahead-contingency contracts 3 PM to 4:30 PM(after closure of Day ahead)
For 24 Hrs the next day
3 Weekly contracts For pre-defined calendar weeks upto a month ahead
Product Development at PXIL is a consultative process involving stakeholders of power sector
PXIL’s In-house software development enables dynamic responses to local market needs
Lack of clarity over regulatory jurisdiction impacting launch of forwards and futures
www.powerexindia.com
Volumes Transacted
Volumes on Exchanges have shown an increasing trend as percentage of total generation
Proactive approach from the regulator and efficient grid management by the system operator
Absence of Universal Service Obligation on Utilities resulting in reduced demand
Dec-09 Jan-10 Mar-10 May-10 Jun-10 Aug-10 Sep-100
200
400
600
800
1000
1200
1400
1600
Increased Transactions Through Power Exchanges
Volumes Transacted through PXs 0 1 2 3 4 5 6 7
0.00200.00400.00600.00800.00
1000.001200.001400.001600.001800.00
Cumulative Monthly Transacted Volumes
20092010
Month of FY 2010-11
Mill
ion
Uni
ts
www.powerexindia.com
Prices
Average Price of electricity Traded over Exchanges
2008 Rs. 7.57/kWh* 2009 Rs. 5.73/kWh
Traded in OTC market 2008 Rs. 7.04/kWh 2009 Rs. 6.41/kWh
Prices in 2010 exhibit a further declining trend.
* Exchanges were in operation only during the last three quarters of the year
Efficient Price Discovery leads to Lower prices on exchange
Softer Prices at the exchange cast a spill over effect on the OTC market
Average Daily Prices exhibit a declining trend
2009
2010
Days of the year
Ave
rage
Dai
ly P
rice
(Rs.
/kW
h)
www.powerexindia.com
Participation
29 States More than 300 participantsMore than 400 portfoliosMaximum Volumes Transacted
Day Ahead Market 65.5 MUs on 21st Aug 2010Term Ahead (weekly) Market 22 MUs on for the delivery week 19/07/2010 to 25/07/2010
Access – Easy, Electronic and Efficient
Information Dissemination – Fast and reliable
Evolution of the market from utility based to industrial consumers oriented
www.powerexindia.com
Services
Information DisseminationRegion-wise hourly price dataCongestion occurrence and detailsClose interaction with System Operator
Capacity Building – Power Markets Centre of ExcellencePower Markets Leadership Programme
Jointly organized with premier institutes like IIM Ahmedabad/IIT Mumbai More than 150 participants
Power Markets Certification Programme Jointly organized with NPTI/ASCI/ISPE More than 50 participants
PXIL’s two pronged strategy for services
To be the thought leaders in the Indian Power Markets
Knowledge sharing amongst stakeholders through continuous engagement
www.powerexindia.com
Achievements of Exchanges
Lowered cost of participation as well as transaction costIncreased participation with Industrial consumers, small captivesIncreased depth and liquidityAvailability of different types of membership to suit the context
Lowered the minimum bid from 1 MW to 0.1 to 0.01 MWIncreased liquidityIncreased participation
Introduced Professional Clearing Membership as a categoryMembership to funding agencies like PFC to provide funds for bids
New Bidding MethodologyBidding in week ahead market which is quasi – continuous to suit Indian context
www.powerexindia.com
Impact of Power Exchanges
AccessUtilitiesIndustrial ConsumersOpen Access ConsumersCaptive sellers
Transparency & EfficiencyBetter price discoverySpill over effect on OTC market
Demand ManagementFreedom to choose amongst products for better portfolio management
PXs have demonstrated that National market for electricity is feasible
PXs have reached their second stage of development to be mandated platforms
Exchanges have made the Open Access Dream; A Reality
www.powerexindia.com
Electricity Act 2003- transition to a market
Compulsory Unbundling of utilities
Complete De-licensing of generation
Separation of “transmission ownership” and “system operation”
Universal Open Access to transmission networks
Consumer level choice of supplier
Development of a multi-buyer multi-seller market in power
The intent and the ethos of EA 2003 towards creating competition at the utility level
as well as the end customer level is still elusive
www.powerexindia.com
Key issues and Challenges-Multiple State level markets
Mixed response to national legislationMultiple States and JurisdictionsMany still vertically integratedIsolated nearly self sufficient marketsOpen Access to transmission lines controlled by State Transmission Utilities Limited Inter - connector capacityInter-connector capacities not with the exchanges
Exchanges and OTC compete for capacity
www.powerexindia.com
Creating Markets
Historically illiquid market Planned dependence on PPA-only 8% of electricity produced traded through short term marketTrading of electricity only a few years old A stable Day Ahead spot market on the Exchange
Pricing Challenges Long term price view yet to emergeDeclining trend in merchant power prices-with near zero cost of avoidable loadExposure to international coal prices-consumer level pricing shocks ?
Sudden Unrestrained growthHigh capacity addition might lead to excess supply or stranding Issues on fuel availability /fuel mix may emerge in the long run
www.powerexindia.com
Transmission Pricing
Infrastructure5 Electrical Regions, More than 25 Control areasTransmission constraints across regions
Transmission pricing based on tenure of transactionsLong Term – More than 25 years
Transmission access given for specific seller and buyer Transmission pricing based on cost of asset and socialized over all beneficiaries in the Region
Short Term – Upto 3 months Transmission access given for each transaction separately for a specific seller and buyer pair Transmission pricing arrived at as a percentage of long term transmission pricing Earnings used to reduce the cost of asset for long term transmission consumers
Day-Ahead Spot Market – For the next day only Transmission access for trades through Power Exchanges - Collective transactions Point of connection tariff – equal price for connection from anywhere in India
Balancing – Real time Power system frequency based pricing Penalty or reward based on deviation from schedule in any 15 min time block
www.powerexindia.com
Transmission Access
Priority to Transmission Open Access given to Long term, followed by Short term and then power exchanges
Based on timing of application for Short Term
Congestion charge applied only on transactions happening through PXs
Different Products treated differentlyCollective transactions for DAS
FCFS for Term Ahead (Weekly) Product
www.powerexindia.com
Renewable Energy CertificatesMarket based instruments for trade between the Eligible Generating firms and Entities carrying Renewable Obligation Initially Non-transferable contracts, mandated to be traded on PXs
Energy Efficiency CertificatesMarket based mechanism to promote energy efficiency in 9 identified industrial sectorsFirms maintaining higher efficiency than set Targets would sell certificates whereas firms with lower efficiency would need to buy
Industrial consumers also carry renewable purchase obligation
Mainstreaming Environmental Products
PXs evolve from being voluntary to mandated platformsPXs evolve from being voluntary to mandated platforms
www.powerexindia.com
Delivery Based ForwardsMonthly Contracts CERC has initiated the process to develop the product attributes to suit the market For delivery contract
Ancillary Services ContractConcept paper floated by NLDC
Financial Products Envisaged in future
Longer Tenure Products
www.powerexindia.com
Future Outlook - PXIL
PXIL remains committed to delivering to its participants contextual products and services on the following principles
AccessibilityAffordabilityReliabilityQuality Availability
www.powerexindia.com
THANK YOUAddress POWER EXCHANGE INDIA LIMITED
"B" Wing, 3rd Floor, Exchange PlazaBandra Kurla Complex, Bandra (E)Mumbai - 400051, India.
Email [email protected]
Website www.powerexindia.com
Telephone No:Fax No:
+91 22 2653 0500+91 22 2659 8397
Contact Details
Top Related