The Indian Energy Exchange (IEX) on Monday announced starting of cross-border electricity trade on its platform in first-of-its-kind initiative for exchanges to expand their power markets beyond India to the south Asia region towards building an integrated regional power market.
This follows notification of cross-border trade electricity (CBET) regulations by the Central Electricity Regulatory Commission (CERC) in 2019 and the recent notification of CBET rules in March.
NTPC Vidyut Vyapar Nigam (NVVN) has secured approval from the Central Electricity Authority (CEA) for Nepal's participation in the day-ahead market on IEX.
Currently, the cross-border trade with neighbouring countries for India stands at about 18 biliion units conducted through the medium to long term bilateral contracts.
As per the CEA and CERC, India imports 8.7 BU from Bhutan and exports 2.37 BU and 7 BU to Nepal and Bangladesh respectively. The power trade with these countries is expected to increase to about 40 BU by FY22 and 70 BU to FY27, according to a study by IRADe.
While the macro-economic growth in south Asia region have been one of the strongest in the world, the region has been confronting with challenges related to power demand-supply balance and the low per capita power consumption.
S N Goel, Chairman and Managing Director of IEX, said India is a power surplus country with a large installed power generation capacity base of 382 GW and peak demand of about 185 GW.
"We have a unique opportunity to lead the regional power market development and make efforts towards enhancing the energy access and security among neighboring nations in the region," he said in a statement.
"We are immensely delighted to welcome Nepal as the first country to commence the cross-border electricity trade in our day?ahead electricity market."
IEX is working closely with leading provider of power trading solutions PTC, NVVN and all other designated nodal agencies for cross-border electricity trade to facilitate inter-country power trade through the exchange market.
The power prices discovered at IEX provide a competitive benchmark as well as provide valuable signals for the value chain, it said.
( With inputs from ANI )
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