DAM Prices 19 Sep 2024 (Rs./kWh)

Only the Exchange Members, who have been admitted as such by IEX, are eligible to enter into Contracts, and undertake transactions relating to such Contracts. Persons, who are not Exchange Members, can participate as Clients through a registered Exchange Member.

For more details, please visit: http://www.iexindia.com/membership/overview.aspx

The technical requirements to start trading are as below:

• Standing Clearance from State Load Despatch Center (SLDC) of State/UT
• Presence of ABT (Availability based Tariff) Meter

Not necessarily. Even if you are not a Member, you can transact through a Member, i.e. by becoming a Client of a Member. Members, however, can trade and clear directly on their behalf as well as on behalf of their Clients.

Entities falling under the category of Interstate generating stations, distributing licensees, electricity traders, brokers and State-embedded entities like IPPs, CPPs, Open access consumers are eligible to become Members.

For more details, click on: http://www.iexindia.com/membership/type_membership.aspx

The technical requirements to start trading are as below:

• Standing Clearance from State Load Despatch Center (SLDC) of State/UT
• Presence of ABT (Availability based Tariff) Meter

No. Members need not be connected to transmission system. A Member can transact on behalf of his Clients connected to the grid.

The following two categories of Client of the Members can be registered:

• Grid-connected Client: A Client who is eligible to buy or sell electricity and is connected to the grid. The entities including but not limited to, Distribution Licensees, Generators, Consumers and Open Access Users can become Grid-connected Clients.
• Trader Client: A Client who is eligible to trade in electricity under the Electricity Act, 2003 and has a legally valid power purchase/sale agreement, which gives the Client the right to purchase and sell electricity. A Trader Client will register each power purchase/sale agreement with the Member who will be registering the same with the Exchange and receive a separate registration identification code. The entities such as trading licensees can become Trader Clients.

The trading operation is conducted under the Automated Screen based Trading system, which is also called Trader Work Station (TWS)

To enhance two way flow of information and bring in transparency between the exchange and the users, IEX is pursuing various initiatives i.e. business circulars, daily SMS service for trade details, display of transaction prices on its website, monthly bulletin and press releases from time to time. There are relevant icons on the homepage of our website (www.iexindia.com) where you can register to get the information you require.

Apart from providing payment security, exchange is also the counter-party for all transactions. Thus, the participants need not know and be concerned about the risk-profile of the other party.

The exchange collects requisite margins (listed below) before trading and the delivery to ensure payment security

In the day-ahead market a Member or the Client is allowed to transact only when the margin deposited by the Member or the Client is at least or equivalent to the average value of transactions done by it for last seven (7) days; or the initial margins prescribed by the Exchange for any Member or the Client.

In the Term Ahead Market the Member or Client will have to make available the following types of margins to the Exchange from time to time as described below:

• Initial Margin (Operational Limit): Initial Margins are computed on the total order value. This initial margin is blocked automatically from the total available deposits. The trading system will automatically reject orders in case the initial margin exceeds the balance deposits available.
• Basis Margin: Additional Margin is computed as a percentage of the traded value as per the risk curve defined and are collected in different trenches as per the contract specifications.
• Variation Margin: The Exchange on a pre decided day also computes the Variation Margin of Members based on their trades (open position).
• Extreme Loss: The Exchange may collect any ad hoc margins from time to time in case if it feels that the available margins collected by the exchange are inadequate due to variation in the prices in the Market.

*All the above mentioned margins can be deposited in form Cash, Bank-guarantee (BG), Fixed-deposit (FD) and Letter of Credit (LC). Please check Rules and Byelaws and circulars of the exchange the relevant margins and collaterals available for meeting such margin requirements.

In the REC Market, Member is allowed to place a purchase order against cash amount made available, equivalent to 100% of the order value. After receiving confirmation about availability of RECs in the depository account of Eligible Entity from the nodal agency (NLDC), the exchange proceeds to process the final bid matching solution. The bids of the Sellers for whom the balance in the depository account with the central agency is reported short, is not considered.

For more details refer to the business rules of the company, available at: http://www.iexindia.com/legaldocuments/rules_laws/businessrules.aspx

In case if the Member wishes to give non cash collateral towards margins, then he will have to submit it at least three day before (in case of FD one day before) from the start of trading day. Non cash collateral can be in the form of:-

• Fixed Deposit (FD)- Minimum denomination for each FD is Rs 2 lacs and value shall be in round figures
• Bank Guarantee (BG)- Minimum denomination for each BG should be Rs 5 lacs and value shall be in round figures
• Letter of Credit (LC)- Minimum denomination for each LC should be Rs 5 lacs and value shall be in round figures

Clearing Banks have been appointed to facilitate electronic transfer of funds between Clearing Members or the Clients, as applicable, and the Exchange. The list of the Clearing Banks along with their details is available on our website at the following link:

http://www.iexindia.com/membership/clearing_bank.aspx

The Day-Ahead-Market (DAM) is the electricity trading market for delivery on the following day. The prices and quantum of electricity to be transacted is determined through a double-sided closed auction bidding process. Following are the main features of DAM:

• 15 minute time block wise bidding for next day
• Trading is on all days irrespective of holidays
• Order entry / revision /cancelation can be done on D-1 (a day before delivery) from 10:00 hrs to 12:00 hrs related to Delivery Day (D day)
• Contract Features
  • Area Clearance Price (ACP) is used for settlement of the contracts.
  • Cleared Volume
  • Total Contract Value: Cleared Volume multiplied by ACP
  • Final settlement adjusted for any force majeure deviations
• Delivery Point
  • Periphery of Regional Transmission System in which the grid-connected entity, is located

For more details, go to: http://www.iexindia.com/products/day_ahead/overview.aspx

Following are the features of the orders placed through DAM:

• Minimum volume step: 0.1 MW
• Minimum price step: Rs 1 per MWh (0.1p/kWh)
• Bids can be single and/or block including linked bids:
  • Single bids/Portfolio Order: 15-Minute bids for different price and quantity pairs can be entered through this type of order. Partial execution of the bids entered is possible.
  • Block orders: Relational Block Bid for any 15-min block or series of 15-min blocks during the same day can be entered. Although no partial execution is possible i.e. either the entire order will be selected or rejected.

For more details, please visit: http://www.iexindia.com/products/day_ahead/trading_flow.aspx

All purchase bids and sale offers are aggregated in the unconstrained scenario. The aggregate supply and demand curves are drawn on Price-Quantity axes. The intersection point of the two curves gives Market Clearing Price (MCP) and Market Clearing Volume (MCV) corresponding to price and quantity of the intersection point. Results from the process are preliminary results. Based on these results the provisional obligation and provisional power flow is calculated. Funds available in the settlement account of the Members are checked with the Clearing Banks and also requisition for capacity allocation is sent to the National Load Despatch Center (NLDC). In case sufficient funds are not available in the settlement account of the Member then his bid (s) is deleted from further evaluation procedure.

Based on the transmission capacity reserved for the Exchange by the NLDC on day-ahead basis by 2.00 PM, fresh iteration is run at 2.30 PM and final Market Clearing Price and Volume as well as Area Clearing Price and Volume are determined. These Area Clearing Prices are used for settlement of the contracts.

For more information, please visit: http://www.iexindia.com/products/day_ahead/trading_flow.aspx

Grid bottlenecks are relieved by comparison of the calculated contractual flow with the transmission capacity available for spot trading, and if the flow exceeds the capacity, the prices are adjusted on both sides of the bottleneck so that the flow equals the capacity. If the flow does not exceed the capacity, a common Market Clearing Price (MCP) is established for the whole area.

If the flow exceeds the capacity at the common price for the whole market area, it is split in a surplus part and a deficit part and Area Clearing Price (ACP) is determined for each part. The ACP is reduced in the surplus area (sale > purchase) and increased in the deficit area (purchase > sale). This will reduce the sale and increase the purchase in the surplus area. In the same way, it will reduce the purchase and increase the sale in the deficit area. Thus, the needed flow is reduced to match the available transfer capability. This method of managing congestion is also known as market-splitting. Initially, the electrical regions are defined as bid areas since inter-regional links are most likely to be congested, however, each electrical region of the country has been divided further into two or more bid-areas so as to accommodate any exigencies of congestion in intra-regional transmission system. As on date, there are 12 pre-defined bid areas in the country.

Click http://www.iexindia.com/marketdata/bidareas.aspx for more info.

Regional/inter-State transmission charges are levied as per CERC Regulations and state transmission charges are levied as per the concerned State Electricity Regulatory Commission (SERC) Regulations. Similarly losses are be accounted for at the time of scheduling and the percentage loss applied is as per the rates decided by CERC/SERC.

Relevant CERC Regulations available at: http://www.cercind.gov.in/2012/regulation/Sharing_Regulations_2nd_Amendment_28_3.pdf

Term-ahead market (TAM) includes products allowing participants to transact for delivery of electricity for duration up to 1 week. It enables participants to purchase electricity for same day through intra-day contracts, for next day through day-ahead contingency, on daily basis for rolling seven days and on weekly basis to manage their electricity portfolios for different durations in a better way.

TAM segment is operated on all days except the specified holidays. The Exchange declares trading calendar indicating trading sessions and trading days for each of Contracts on quarterly basis. It may extend, advance or reduce trading hours by notifying the Members as and when it deems fit and necessary.

For viewing the trading calendar, please visit: http://www.iexindia.com/marketdata/trading_calender.aspx

For matching of contracts, different auction methodologies are employed. The two key matching methodologies adopted in general are explained below:

• Uniform Price Step Auction
  The participants submit their orders for sale and buy during the call auction phase. Such orders are automatically stored in the order book without giving rise to Contracts. After the end of the call auction phase, there is a call auction freeze phase. Until the call auction freeze phase, Members can enter new orders (or quotes) or modify their existing orders. Transaction takes place after the call auction freeze phase is over. The matching of orders takes place in accordance with matching rules. All transactions are affected at uniform price known as Equilibrium Price (EP). All orders that have prices that are better than the equilibrium price are executed, and the ones that have a price equal to the equilibrium price are executed according to a First in First out (FIFO) algorithm. In such auction, the transmission network constraints are not considered implicitly while matching the orders.
  
  Open uniform price auction:
  In the open auction, the participants submit their order for sale and buy during the auction phase. Complete list of order prices and aggregated quantities of buy and sale bids is displayed to market participants maintaining bidder’s anonymity. The participants can modify, delete or enter new orders during call auction period.
  
  
• Continuous Trade Session
  In this trading session, the participants submit buy and sale offers on a continuous basis during the trading period. The buyers and sellers are matched on continuous basis with price-time priority. For a specific Contract, the seller with minimum quote and buyer with the maximum quote are considered as best seller and best buyer. Best five buy and sell bids, excluding the details of participants, are displayed on the trader’s work station (TWS) to all the participants to show the market depth. In case, best buy order is better than or same as best sale order, they are matched resulting into Contracts. Such matching continues till the end of trading period. In case, best buy order is worse than the best sale, they will continue to be available in the order book, without resulting into Contracts.

Open Auction

• Orders accumulated during call phase (no matching)
• Orders matched after call period
• Orders are used for calculation common price i.e. Equilibrium Price.
• All successful orders matched at Equilibrium Price.

Continuous Trading

• Price-time priority based continuous matching
• The highest Buy order & lowest Sell order gets the priority
• If the prices are same then priority is given to the time of the order received.

Renewable Energy Certificate (REC) represents the green attributes of electricity generated from renewable energy source. These attributes are unbundled from the physical electricity and the two products—the attributes embodied in the certificates and the commodity electricity—are sold or purchased separately. While the green power can be sold to the distribution licensee at preferential tariff, the generator can get the green attributes issued for every 1 MWh of green energy injected into the grid (1 REC=1 MWh). These green attributes can be separately traded at power exchanges.

For more details, please visit: http://www.iexindia.com/products/rec/overview.aspx

There are two types of certificates:

• Solar certificates for generation through solar
• Non-solar certificates for generation through all renewable sources other than solar

• Eligible Entity- Those who generate power from renewable sources approved by Ministry of New and Renewable Energy (MNRE).
  More details at: http://www.iexindia.com/products/rec/sell_rec.aspx
• Obligated Entity- Those who have obligation to purchase some percentage of their consumption as mentioned in their respective state REC regulations either from renewable power or the renewable energy certificate. . The CERC – REC Regulations, recognise the obligated entities as: distribution utility, open access consumer and captive power consumer.
  More details at: http://www.iexindia.com/products/rec/buy_rec.aspx
• Voluntary Entity- Those who purchase RECs voluntarily to offset the carbon footprints of their business activities or for CSR activities.
  For more details: http://www.recregistryindia.in/

The Central Electricity Regulatory Commission (CERC) approved the procedures to participate in REC Mechanism in its regulation dated 14th January, 2010. The procedure approved and notified by the regulator broadly involves four parts: procedure for accreditation through State Nodal Agency; Procedure for Registration through Central Agency NLDC; Procedure for Issuance through Central Agency (NLDC) and procedure for trading and redemption through power exchanges.

For details: http://www.iexindia.com/products/rec/rec_mech.aspx

CERC in its order dated 30th December, 2014 revised the floor & forbearance price for the control period April, 2012 to March, 2017. The revised prices are as follows:

REC trading is done through a closed double-sided auction between 13:00 Hrs to 15:00 Hrs on last Wednesday of every month.

For complete trade cycle visit: http://www.iexindia.com/products/rec/rec_timeline.aspx