Spot power price fall a one-off event, say firms

The decline in electricity prices on energy exchanges is a temporary phenomenon and is unlikely to significantly affect the signing of power purchase agreements (PPAs) or the setting up of new power plants, according to executives at power companies.

- RAGHAVENDRA KAMATH

The Market Clearing Price in the Real Time Market (RTM) declined 28% year-on-year in May, while prices in the Day Ahead Market (DAM) dropped 22%, according to the Indian Energy Exchange (IEX), a leading electricity exchange platform. IEX attributed the decline to early rains, which reduced electricity demand, along with increased hydro, wind and thermal generation that boosted supply liquidity on the exchange platform, leading to a substantial fall in both DAM and RTM prices.