NEW DELHI: Spot power prices spiked to five-year-high of Rs 14 per unit in the day-ahead market (DAM) for short periods on the Indian Energy Exchange as state utilities and other consumers rushed to make up the shortfall in generation from hydel, wind and coal-fired stations.
IEX data showed buy bids for 265 MUs (million units) against sell bids of 200 MUs for Tuesday delivery during trading hours. But exchange executives allayed fear of persistent high prices, which can push up power bill of states by 30-40%.
The executives said the average price hovered around Rs 6 per unit and the spike was seen in a “few trading blocks of 15 minutes each and did not sustain over two-three blocks. According to demand-supply data monitored by IEX, wind generation, mostly in the south, was down 33%; while output from hydel stations declined 19% as reservoirs in the north ran low and solar as well as thermal stations fell by 16%.
While coal-fired power plants of Central and state utilites largely coped with much of this shortfall, independent power producers and captive generators rushed to the exchange to meet shortfall in production due to coal shortage.
This demand had pushed up spot power prices to Rs 12.95 per unit on Sunday for supply on Monday on IEX as buy bids of 298 MUs outstripped supply bids for 192 MUs. The rates had touched Rs 11.41 per unit in May.
The current situation appears to be headed for a repeat of events in August-September period of 2017 when nuclear generation fell 36%, wind 14% and hydel 12%. Supplies from Bhutan also dipped. This supply gap was met by coal-fired plants, which saw generation rising by 17% as units spun at 58% of capacity against 52% in August 2016.