POWER DE­MAND ZOOMS TO RECORD HIGH OF 1.5 L MW

IEX PRICES UP ON RISE IN FARM DE­MAND & LOWER HY­DEL POWER GEN­ER­A­TION

Resource Digest - - POWER DEMAND -

Power de­mand has crossed the 1.50 lakh Mw level for the first time be­cause of in­creased farm de­mand and re­duced gen­er­a­tion from hy­del power sta­tions as the mon­soon re­cedes, push­ing elec­tric­ity prices on the In­dian En­ergy Ex­change (IEX) to a record.

Ac­cord­ing to data pro­vided by the Na­tional Load Des­patch Cen­tre, which over­sees elec­tric­ity trans­mis­sion, the to­tal de­mand for power on Septem­ber 15 touched 1.52 lakh Mw. About 1.47 lakh Mw of this was met while there was a short­fall of 4,500 Mw.

“In­creased vol­umes were largely due to a surge in de­mand for power in Ra­jasthan, Pun­jab, Ut­tar Pradesh, Ut­taran­chal, Bi­har, Ch­hat­tis­garh and Ma­ha­rash­tra where there has been an abrupt end of the mon­soon, lead­ing to in­creased tem­per­a­tures and agri­cul­tural load,” said Ra­jesh K Medi­ratta, di­rec­tor, IEX.

The av­er­age mar­ket clear­ing price rose to a new high of `3.64 per unit on the ex­change, up 32% from `2.74 in Au­gust. With the kharif sea­son at its peak, farm­ers need power to ir­ri­gate land as the June-Septem­ber mon­soon ta­pers off. To be sure, there has been a late mon­soon re­vival in some parts of the coun­try.

“In­creased de­mand has prompted idle power ther­mal ca­pac­i­ties from in­de­pen­dent power pro­duc­ers to light up their boil­ers,“he said. “In­de­pen­dent pro­duc­ers that de­pend on do­mes­tic coal have been able to light up their boil­ers while the ones de­pend­ing on im­ported coal will have to wait for a few weeks be­fore they can cash in on the de­mand.”

The IEX spot power mar­ket saw a record trade of 137 mil­lion units for de­liv­ery. Septem­ber has seen de­mand surge with the 100 mil­lion unit level be­ing crossed 11 times, in­clud­ing 10 days in a row start­ing Septem­ber 6. The pre­vi­ous high was 131 mil­lion units traded on Oc­to­ber 10, 2014.

Septem­ber 15 saw buy bids of 178 mil­lion units and sell bids of 158 mil­lion units. The av­er­age daily vol­ume in Septem­ber has been 109 mil­lion units, an­other high for the spot power mar­ket.

“De­mand for power is ex­pected to re­main around 1.5 lakh Mw level till agri­cul­tural de­mand per­sists. It is ex­pected to re­main till the end of Septem­ber,” said Medi­ratta.

In­creased de­mand is good news for all ther­mal power pro­duc­ers that have been suf­fer­ing from un­used ca­pac­ity, a se­nior power sec­tor ex­ec­u­tive said.

Ca­pac­ity util­i­sa­tion had dipped to 59% in June, the low­est in sev­eral years, he said. Sev­eral in­de­pen­dent power pro­duc­ers and ther­mal gen­er­a­tors with­out any power pur­chase agree­ments did not find it eco­nomic to keep their plants run­ning.

A Coal In­dia of­fi­cial said plants have the fuel they need to meet de­mand. “Coal avail­abil­ity at power plants is at com­fort­able level of 20 days hence in­creased de­mand will al­low then to scale up gen­er­a­tion and in­creased plant load fac­tors,” he said.

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