10 customized india newsletter march 2012 9 apr 2012 - issue 10

8/2/2019 10 Customized India Newsletter March 2012 9 Apr 2012 - Issue 10

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Customized Energy Solutions 1

StateOld Rate (Rs / kWh) New Rate (Rs / kWh)

HT Tariff LT Tariff HT Tariff LT Tariff

Punjab 4.58 4.14 4.95 4.47

Haryana 4.15 3.91 4.70 4.50

Rajasthan 4.01 3.75 5.00 4.75

Bihar 4.70 4.75 5.10 5.20

Madhya Pradesh 3.78 4.45 4.20 4.80

Andhra Pradesh 2.97 3.25 3.97 4.80

Uttarakhand 2.99 2.99 3.17 3.17

Tamil Nadu 4.00 5.50

March, 2012

Issue 10

STATES Seek NOD to hike ower tariff

In order to reduce the deficit on account of unpaid dues by government backed power utilities, some of them have

already increased the Retail Tariff and more are likely to increase the tariff in coming months.

Tamil Nadu, Punjab, Haryana, Rajasthan, Bihar, Madhya Pradesh, Andhra Pradesh and Uttarakhand have already

increased the Retail Tariff. The tariff hike is ranging from 7% - 50% in different categories.

Also, there are few states such as Karnataka, Uttar Pradesh, Tripura and West Bengal have also submitted their proposal

to the Electricity Regulatory Commission seeking a tariff revision.

Inside This IssuePower Exchanges starts scheduling for 15 minute time block 2

Congestion on Inter-state Transmission Corridor for Day-Ahead Market on Power Exchange

2

Bachat Lamp Yojana 3 &

4

Review of REC Trading March 2012

5

Possibilities for next trade session 6

Monthly Analysis of OTC contracts for the month of February 2012

Customized EnergySolutions is committed to

working with each of our

clients to analyze their

needs, simplify the

solutions, and implement

an informed, fiscally

responsible plan to help

them to navigate the

complex energy markets.


2/9

Customized Energy Solutions www.ces-ltd.com 2

Power Exchanges starts scheduling for 15

minute time block

The power exchanges in India have started scheduling

in 15 minutes time block from 1st April in Day

Ahead Market. This 15 minute scheduling will help in

managing the ABT mechanism in a better way as the

computation of ABT / UI Mechanism is also done in

15 minutes block interval.

Every 15 minute time block will be treated as a

separate contract under this new system. This will

bring more stability in demand and supply

management. The two exchanges have already made

necessary changes in their systems to go for the

arrangement.

Since January 2012, approximately 1500 MUs have

been curtailed due to congestion. Congestion is

occurring during evening peak hours on both the

power exchanges, primarily for Southern Region.

This is happening at the time when Open AccessConsumers are participating on the Power

exchange, in order to run their plant during load

shedding hours. The volume of electricity that

could not be cleared due to congestion and could

not been transacted through power exchanges is the

difference of unconstrained cleared volume

(volume of electricity that would have been

scheduled, had there been no congestion) and

actual cleared volume.

Congestion means a situation where the demand

for transmission capacity exceeds the available

transfer capability

Market Splitting is a mechanism adopted by

Power Exchange where the market is split in theevent of transmission congestion, into

predetermined (by NLDC) bid areas or zones,

which are cleared individually at their respective

area prices such that the energy balance in every

bid area is reached based upon the demand and

supply in individual bid areas and using the

available transmission corridor capacity between

various bid areas simultaneously. As a result of this

market splitting the price of electricity in the

importing region, where demand for electricity is

more than supply, becomes relatively higher than

the price of electricity in the exporting region.

Source: NLDC

Congestion on Inter-state Transmission

Corridor for Day-Ahead Market on Power

ExchangeCongestion on Inter-state Transmission Corridor for

Day-Ahead Market on Power Exchange

Power Exchanges use a price discovery mechanism in

which the aggregate demand and supply are matched

to arrive at an unconstrained market price and

volume. This step assumes that there is no congestion

in the inter-state transmission system between

different regions. However, in reality, the system

operator, NLDC in coordination with RLDCs, limits

the flow due to congestion in the inter-state

transmission system. In such a situation, Power

Exchanges adopt a mechanism called Market

Splitting.


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In India, lighting accounts for almost 20% of

the total electricity demand and contributes

almost fully to the peak load as well. The vast

amount of lighting in India is provided by

incandescent bulbs, which are extremely

energy inefficient. Only about 5% of the

electricity is converted into light, the rest is

lost as heat, whereas CFL uses only one-fifth

as much electricity as an incandescent lamp to

provide the same level of illumination. CFLs

have almost completely penetrated the

commercial market, and the sales of CFLs in

India have grown from about 20 million in

2003 to more than 100 million in 2010.

However, penetration into households has

been very limited, largely because of the highprice of the CFLs. The price of CFLs has

decreased considerably with the increasing

market volumes, but is still in the Rs. 80-100

price range. On the other hand, incandescent

bulbs are available in the price range of Rs.10-

15. It is estimated that about 400 million light

points in India today are lighted by

incandescent bulbs; their replacement by

CFLs would lead to a reduction of over

20,000 MW in electricity demand.

In this regard, BEE has initiated Bachat

Lamp Yojna (BLY), efficient lighting program

The BEE has also successfully registered the

Bachat Lamp Yojna as a Clean

Development Mechanism Program of

Activities (CDM PoA). The BLY PoA aims

at large-scale replacement of incandescent

bulbs in households by CFLs. The PoA uses

the approved CDM methodology AMS II J

for the replacement of Incandescent Lamps

by Compact Fluorescent Lamps in the

residential sector. It seeks to provide CFLs

to households at the price similar to that of

incandescent lamp and plans to utilize the

Clean Development Mechanism (CDM)

under the Kyoto Protocol to recover the cost

differential between the market price of the

CFL and the price at which the CFL is soldto household. The model is such that it

captures the energy savings of Demand Side

Management program which is translated in

reduction in carbon emissions and thereby

creating CERs. These CERs are issued after

monitoring and verification based on Clean

Development Mechanism (CDM)

modalities and procedure, according to

approved baseline and monitoring

methodologies under the Kyoto Protocol

and then traded. The funds so generated are

ploughed back to the DSM project.

BACHAT LAMP YOJANA(POA)


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The key elements of such a program involving replacement of incandescent bulbs with

Compact Florescent Lamps (CFL) are:

To prepare CDM Program Activities (CPAs) under the PoA, CFL manufacturers would

enter into agreements with electricity distribution companies (Discoms) for sale of CFLs

to households in the Discoms area of operation at a price comparable to that of

incandescent bulbs. The manufacturer would also establish a mechanism for the

buyback of fused CFLs. Each area for which an agreement has been signed would

constitute one CPA.

BEE ensure that the CPA-DDs and the documentation meets all the requirements

determined in the PoA and then submits the CPA-DDs to a DOE for consistency

checking and submission to the CDM Executive Board for registration and project

inclusion.

BEE would periodically provide a subset of monitoring reports to the DOE as andwhen submitted by the CPA implementers as per the CPA DDs for their due

diligence.

BEE would instruct the DOE to submit a request for issuance of Certified Emissions

Reductions (CERs) and instruct the CDM Executive Board to forward CERs to the

BLY investor according to their share in achieved emissions reductions.

The CERs issued will be traded with companies in developed countries who will use

these CERs to partially meet compliance with their quantified emission limitations and

reduction requirements

The BLY PoA will be jointly developed by the CFL manufactures, Distribution Utilities and

BEE under public private partnership mode. Number of project developers have shown

interest and came forward to develop CPAs throughout India under registered BLY PoA.

Total twenty numbers of Investors have been empanelled by BEE who is interested in

implementation in different states. As on date, 50 numbers of CPA DDs (i.e. 8 from AP, 7

BACHAT LAMP YOJANA (POA) contd.

Source: BEE


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Review of REC TradingMARCH 2012

On 28th March 2012, trading session of REC was conducted on both the Power Exchanges for the month of

March. Total Volume cleared in this trading session was 3% lower than previous trading session. RECs

available for sale had decreased by 1% as compared to previous trading session.

A total of 238,282 Non-Solar RECs were available for trading, however, actual participation was for 231,312

RECs only. A total of 199,737 RECs were traded (86%) at an average price of Rs 2,907 per Non-Solar REC.

Both the cleared price and quantum have decreased vis--vis previous trading session. There were 9,101 Solar

REC buy bids on the Power Exchanges. Firs Solar PV Plant in Madhya Pradesh has been registered on

NLDC. IT is expected to participate on Power Exchange Shortly.

Volume cleared in this month is 86%; almost the same percentage as is being witnessed for the past few

Trading Sessions.

Compared to previous month, this month also saw an increase in the number of participants in REC market.Total number of participants in this month was around 389. Some of the important cues of this Trading

Session are summarized below:

Out of238,282 RECs issued, 231,312 (97%) RECs participated in this trade session (IEX+PXIL). InFebruary, this percentage was also 97%.

Of238,282 RECs that were available for sale (IEX+PXIL), 199,737 (86%) RECs got sold. Total buybid for RECs was 323,767 (1.6 times).


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Possibilities for next trade session

Total No. of RE Generators who have been registered by NLDC are 366, with total aggregated

capacity of 2318 MW. Another 89 RE Generators are pending for registration with a total capacity o

350 MW. The Clearing price of RECs will go down during first few months of this Financial Year, as there wi

11 more trading sessions before the compliance date.

First Solar PV project of 2 MW in Madhya Pradesh have been Registered. We may soon witness fir

Solar REC Trade in coming months.

Source: Recregistryindia / IEX / PXIL


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Monthly Analysis of the OTC Contracts for FEBRUARY

2012

1. The reported short-term contract volume for the month of February was 1158.14 MUs whereas the

same was 1895.48 MUs for the month of January. A decrease of 39% in reported contract volume.

2. 97% of total volume has been contracted at the price above Rs. 4/kWh.3. Total number of contracts (including swap & Banking) in February was 107 by 5 traders whereas in

January it was 137 by 6 traders.

Observation:1. In the month of February, OTC contract prices were higher than the Indian Energy Exchange (IEX

and Power Exchange of India Ltd. spot prices.

2. The minimum price in the exchanges during 30th

Jan 2012 26th

Feb 2012 was Rs. 3.01 / kWh

(PXIL, 31st

Jan 2012) while that in the OTC market it was Rs. 2.96 / kWh (30th

Jan 26th

Feb)

Maximum price in Day-Ahead Exchange reached Rs. 4.06 / kWh (IEX, 2

nd

Feb 2012) while in OTCMarket it was Rs 5.60 / kWh (5

thFeb) which was a peak power contract.

3. OTC Contracts are mostly for a delivery period of one month or above. The scheduling of these

contracts is generally happening from one month after contract date. Power Exchange is a day ahead

market with standardized contracts and no corridor assurance while the OTC Contracts are

weekly/monthly contracts with flexibility of customization and corridor assurance

4. The number of contracts entered above Rs 4/kwh were 33 out of total 91 contracts. There were a

total 107 contracts including swap & banking during the month.

5. The cumulative volume trade above Rs 4/kWh was 919.64 MUs which is 97% of total OTC contract

for the reported period (30th

Jan 2012 26th

Feb 2012).

Source: CERC


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Useful data

All India Region-wise Generating Installed Capacity (MW) Of Power Utilities Including Allocated Shares inJoint and Central Sector Utilities (As on 29 February 2012)

Sr.No. RegionThermal Nuclear Hydro R.E.S.@ TotalCoal Gas DSL Total (Renewable) (MNRE)

1 Northern 27817.50 4171.26 12.99 32001.75 1620.00 15022.75 3830.32 52474.822 Western 35204.50 8254.81 17.48 43476.79 1840.00 7447.50 6810.28 59574.573 Southern 21232.50 4690.78 939.32 26862.60 1320.00 11338.03 10976.45 50497.084 Eastern 21122.88 190.00 17.20 21330.08 0.00 3882.12 381.71 25593.915 N. Eastern 60.00 787.00 142.74 989.74 0.00 1158.00 228.31 2376.056 Islands 0.00 0.00 70.02 70.02 0.00 0.00 6.10 76.127 All India 105437.38 18093.85 1199.75 124730.98 4780.00 38848.40 22233.17 190592.5

Captive Generated Capacity Connected to Grid (MW) = 19509

Fuel Mix India

All India Thermal Nuclear Hydro RES@ GrandTotalCoal Gas Diesel Total (Renewable) (MNRE)MW 105437.38 18093.85 1199.75 124730.98 4780.00 38848.40 22233.17 190592.55

%age 55.32 9.49 0.63 65.44 2.51 20.38 11.67 100.00

Power Supply Position February12Power supply Position 2011-12(FEB,12)

Region Energy (MU) Requirement Deficit % Peak Demand (MW) Deficit %Northern 22332 -7.7 36684 -9.6Western 24426 -13.4 41277 -13.9Southern

22363 -13.3 35343 -15.2Eastern 8109 -6.8 13563 -5.8

North Eastern 837 -11.2 1813 -10.5All India 78067 -11.1 128680 -12.1

Source: CEA:http://www.cea.nic.in/

Customized Energy Solutions FEBRUARY 2012
http://www.cea.nic.in/http://www.cea.nic.in/http://www.cea.nic.in/http://www.cea.nic.in/


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Customized Energy Solutions www.ces-ltd.com 9Customized Energy Solutions FEBRUARY 2012

Useful data

Source: CERC

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10 customized india newsletter march 2012 9 apr 2012 - issue 10

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