Power tariff soars to a decade high of Rs 17.61 a unit in spot market

Representative Image

Power tariff Sunday touched a decade high of Rs 17.61 per unit in the spot market due to low hydro and wind energy production and coal shortage at thermal plants.

"Spot power price for supply touched almost 10-year high of Rs 17.61 per unit in spot trading on Indian Energy Exchange (IEX) on Sunday. The average spot power price was also high at Rs 7.64 per unit at IEX on Sunday," a source said.

The power price have seen an upward trend in the day ahead market (DAM) at IEX since last Sunday when it touched to a high of Rs 14.09 per unit. The prices soared further to hit a nine-year high of Rs 16.49 per unit in the day ahead market on Friday.

According to the IEX data, the previous high was recorded at Rs 17 per unit in August 2009.

A total of 271 MU (million units) were sold for supply on Monday. In the DAM trading session concluded Sunday at IEX, there were buy bids for 306 MU against sell bids for 357 MU.

Power Secretary A K Bhalla last week had said that around this time of the year wind energy suddenly goes down and hydro also starts declining that is where some constraints always come in.

"We were not able to build coal stocks in power plants especially in northern states," he had said.

The source said captive power plants (CPPs) were grappling with the issue of coal shortage. CPPs generate electricity for their own manufacturing facilities like steel, cement and others.

According to the Central Electricity Authority data, as many as 19 thermal plants had coal stocks of less than seven days of consumption as on September 27.

Last Thursday, Power Minister R K Singh had asked state power generators like NTPC and DVC to strengthen their coal mining wing and secure more coal mines noting that supply of the dry fuel to power plants was still a concern.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel