The average weighted market clearing prices (MCP) in the day ahead market (DAM) segment on the Indian Energy Exchange (IEX) declined around 17 per cent y-o-y in the last calendar year aided by higher electricity generation and availability.
The DAM is the most traded segment on IEX, which is India’s largest power trading exchange.
According to IEX data, the average weighted MCP for the 2024 calendar year (CY) fell 17 per cent y-o-y to around ₹4.59 per kilowatt hour (kWh) from ₹5.53 per unit (kWh) in 2023 (CY). In 2022 CY, the average weighted MCP was ₹5.90 per kWh.
Rohit Bajaj, Joint Managing Director at IEX, told businessline, “A series of proactive measures, including sale of surplus un-requisitioned power on exchanges, enhanced fuel supply and improved availability of generating units, were implemented by the government and regulators, significantly boosting sell-side liquidity on power exchanges. This rise in supply helped moderate prices.”
According to India Ratings and Research (Ind-Ra), weighted exchange tariffs moderated to ₹4.35 per unit in 8M FY25, led by a moderation in the power demand due to the excess rainfall during the year and improved supply.
Due to additions in generation and transmission capacities, energy shortages at national level fell to 0.1 per cent in FY25. Total installed power generation capacity rose 83.8 per cent from 249 GW in March 2014 to 457 GW as of November 2024.
Bajaj emphasised that government’s continued focus on infrastructure development, innovation push and economic growth helped India’s energy consumption reached nearly 1,700 billion units (BU) in 2024, marking a 6 per cent y-o-y growth, while peak demand soared to 250 gigawatts (GW), surpassing the previous record of 243 GW in 2023.
Ind-Ra expects the average merchant market prices to remain at ₹4.5-5 per unit over FY25-FY26, amid an improved power supply position led by capacity additions.
The average availability of electricity in rural areas enjoy up to 21.9 hours of power supply, while urban areas now enjoy up to 23.4 hours. The per capita electricity consumption surged to 1,395 kWh in FY24, a 45.8 per cent increase from 957 kWh in FY14.
