Indian spot market prices peak after less generation from wind
Spot market power prices in India reached a three-year high of INR9 ($0.14) per unit, as coal-based power plants ramped up production following a 70% drop in wind-based electricity last month, compared to August 2016. Less rainfall in southern and western states during the same period resulted in a 12% reduction in hydro power generation. The buoyant spot prices are expected to last until the weather turns cooler.
NEW DELHI: Spot market power prices have peaked Rs 9 per unit, a threeyear high, while the average price on India Electricity Exchange also rose to Rs 5 per unit on low electricity supply. The prices are expected to remain high until the warm weather conditions recede.Industry sources said while the power demand remained at the same level as last year, supply was low due to lesser generation from wind and hydropower plants . The development, however, comes as a relief to coal-based power plants that have ramped up production.There has been growth of 17% in coal-based thermal power generation, on account of reduction in hydro power generation by 12%, in nuclear power generation by 36% and others by 7% in August 2017 over August 2016, a statement issued by the coal ministry said.Data available with the Central Electricity Authority showed that the thermal power plants operated at 58% last month against 51.59% in the same period last year. Sources said wind-based generation dropped by 70% due to unfavourable weather conditions across states like Tamil Nadu, Gujarat and Madhya Pradesh.The hydro generation declined 12% due to less rainfall in southern and western states and nuclear generation was down by over 36%. Data available with India Energy Exchange showed that the trading volume on Wednesday stood at an all-time high of 183 million units, while prices peaked to Rs 9.2/unit on Tuesday across India for a 15-minute slot. The maximum clearing price on Wednesday was Rs 7.90/unit.Spot power prices have been rising since August, typically an irrigation period. They rose by 8.5% last month over previous month due to increase in electricity demand by the southern states. The market clearing price at Rs 3.13 per unit last month was 26% higher from price in July 2017 (Rs 2.49 per unit) and 44% higher than August 2016 (Rs 2.17 per unit).Meanwhile, coal secretary Susheel Kumar had on Tuesday reviewed coal stock position at various power plants and directed to raise loading to 250 railway rakes per day. “For every power plant, one subsidiary of Coal India (CIL) has been assigned the role of lead company. The lead company shall be responsible to monitor and ensure that power plants linked to it are out of criticality. A control room at CIL will monitor coal supply position to the TPPs on 24x7 basis,” the statement said.