IEX Q3FY22 Concall transcript
Transcript summery
End of Dec 21 India's renewable installed capacity was 151 gigawatt. Renewable Energy part increased to 38%. India announced an ambitious
target of achieving 500 gigawatt of renewable energy by 2030.
On 16th December 2021, CERC issued the draft CERC (Connectivity and General Network Access to the inter-State Transmission System) Regulations, 2021. This will simplify, ease, and clarify how transmission access will be available for participants on the Exchange. Post implementation of GNA, decision making by market participants, to participate on the Exchange, will not be contingent upon transmission access and charges. GNA will promote development of power market in the country
On 6th October 2021, the 10 year long pending jurisdictional conflict related to power market between CERC and SEBI was resolved by Hon’ble Supreme Court, paving way for the introduction of the much-awaited long duration contracts in power and renewable energy on the Power Exchanges.
This will also enable launch of electricity derivatives on Commodity
Exchanges. Electricity derivatives will smoothen out the price volatility and also buyers will be able to hedge their positions and take delivery in spot markets. This will lead to an increase in the Exchange transactions. Following this resolution of conflict, IEX has applied to CERC for approval of our longer duration contracts.
The Green Day-Ahead market was inaugurated by Shri R. K. Singh, Honorable Minister for Power and New and Renewable Energy, on 25th October 2021. It now complements the Term-Ahead contracts for solar and non-solar energy within the Green Market
IEX likely to resume ESCerts trading soon which was halted due to administrative reasons.
Cross border trade with bhutan also commenced. with nepal its already there.
In Q3 2021 IGX recorded trade volume of 3.6 million MMBTU,
Cumulatively 5 million MMBtu was traded through IGX during the year.
revenue for the quarter increased by 32.4% The PAT grew by 33% on year-on-year basis with a margin of 63.1%
applied to the regulator for approval of this product gross bidding
Q. On general network access, do we mean that once implemented, we will get rid of the open access charges which are levied by the state?
Ans : it is only the buyers who are required to pay. Earlier, both buyer and seller were required to pay the charges, now only buyer will have to pay. So, it is making the process simpler. There is also a provision for short-term general network access, if anybody has seasonal demand for maybe two, three months time and he wants to take additional access depending on the availability that can be given to him
We are confident that gross bidding if implemented effectively and used by the state effectively there is no need of MBED.
derivatives for hedge the positions in derivative market and take delivery in the spot market
Gujarat, Maharashtra, UP, Tamil Nadu these 4 - 5 states itself is contributing to 50% of the consumption of the whole country,
Gross bidding -> The states who have allocation from the low cost power plant and do not have demand to utilize the full allocation, they can sell that power on the exchange platform at the exchange clearing price and take advantage of the low variable cost power. Presently in most of the states power remains unscheduled. Under the gross bidding mechanism they will be able to sell the power and take advantage of the market clearing price. If the market clearing price is more than the variable cost of those plants they can make some gain out of that.
IGX is multiplying their volumes on QOQ basis and also almost at breakeven levels.
Gross bidding
more explanation for gross bidding → what is gross bidding and its requirement
GNA Access of inter-state transmission system. Regulations, 2021raft Connectivity and General Network Access to the inter-State Transmission System) Regulations, 2021 → GNA access to inter state transmission system
press release in CERC and SEBI case → press release