Lok Sabha Question No. 1817 (UNSTARRED), answered on 2021-07-29
Subject: Rise in Spot Power Price
Ministry: POWER
Asked by: Thirumaa Valavan Thol

## GOVERNMENT OF INDIA MINISTRY OF POWER

## LOK SABHA UNSTARRED QUESTION NO.1817 TO BE ANSWERED ON 29.07.2021

## RISE IN SPOT POWER PRICE

## 1817.  SHRI THIRUMAAVALAVAN THOL:

Will the Minister of POWER be pleased to state:

(a) whether  the  Government  is  aware  of  the  sharp  rise  in  the  average  spot  power price from March 2020 to March 2021;

(b) if so, the details thereof;

(c) whether  such  sharp  rise  is  attributable  to  the  input  cost  or  manipulated  to increase profit by the producers/traders; and

(d) if  so,  the  details  thereof  along  with  the  measures  taken  by  the  Government  to control such sharp rise in the price?

## A N S W E R

THE MINISTER OF POWER AND NEW & RENEWABLE ENERGY

(SHRI  R.K. SINGH)

(a) to (d) : It is not correct that there has been a sharp rise in the average spot power price from March, 2020 to March, 2021.  In fact the average price of power sold through the  Power  Exchanges  declined  from  Rs.3  per  kWh  in  2019-20  to  Rs.2.82  per  kWh  in 2020-21.    The  details  of  the  average  price  and  volume  of  the  electricity  transacted through  Power  Exchanges,  for  the  period  March  2020  to  March  2021  are  given  at Annexure.

The  Power  Exchanges  have  been  set  up  under  the  CERC  Power  Market Regulations,  which  provide  that  Power  Exchange  is  a  market  where  buyers,  sellers, electricity traders etc. transact electricity on standardized contracts.

The electricity price in the spot market is a function of demand and supply forces  in  the  market  which  are  in  turn  dependent  on  the  overall  macro-economic situation  of  the  country.  Electricity  price  in  the  Day  Ahead  Market  on  the  Power Exchanges is discovered through market mechanism, viz. Aggregate Demand (Total Buy Bids)  and  Aggregate  Supply  (Total  Sell  Bids)  and  the  bidding  mechanism  follows  the double sided closed bid auction on a day-ahead market.

Over the fiscal year 2020-21, new market developments have been brought in such as  introduction of Real Time Market (RTM) to manage electricity requirements closer to real time, Green Term Ahead Market (G-TAM) to provide additional avenues to RE generators and notification of the CERC Power Market Regulations 2021 to cater to the  increasing  depth  of  the  Indian  power  market  and  growing  need  for  information exchange among market participants as well as to strengthen the mechanism for market surveillance and monitoring.

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ANNEXURE ANNEXURE REFERRED TO IN REPLY TO PARTS (a) TO (d) OF UNSTARRED QUESTION  NO.  1817  TO  BE  ANSWERED  IN  THE  LOK  SABHA  ON 29.07.2021

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The  average  price  and  volume  during  March  2020-March  2021  are  provided below:

| Months   |   Avg Price (Rs./Unit) |   Cleared Volume (BU) |
|----------|------------------------|-----------------------|
| Mar 20   |                   2.45 |                  3.97 |
| Apr 20   |                   2.42 |                  3.69 |
| May 20   |                   2.57 |                  5.57 |
| Jun 20   |                   2.35 |                  4.17 |
| Jul 20   |                   2.47 |                  4.49 |
| Aug 20   |                   2.43 |                  4.48 |
| Sep 20   |                   2.69 |                  4.78 |
| Oct 20   |                   2.74 |                  5.5  |
| Nov 20   |                   2.73 |                  4.86 |
| Dec 20   |                   2.83 |                  5.61 |
| Jan 21   |                   3.18 |                  5.57 |
| Feb 21   |                   3.39 |                  5.1  |
| Mar 21   |                   4.07 |                  6.55 |

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