Traders eye captive units as govt allows sale of power in market (Live mint.com 4th Feb 2008) Aashir Valia, a commodity trader who has just set up his own namesake trading business, Valia Commodities Ltd, is planning to enter India’s nascent energy trade.
Valia says he is talking to a slew of captive power generators in India who can be his customers, both as suppliers as well as buyers of power.
Valia is one of many who are exploring the possibility of trading on power through the online power trading platform, the Indian Energy Exchange (IEX), being set up by Financial Technologies Ltd under the aegis of the Central Electricity Regulatory Commission. It is expected to begin trading in next fiscal year.
“Many of them (captive generators) are not even utilizing the additional capacity they have because they are not in the business of trading power,” said Vaila. “Independent traders are negotiating with them to sell their additional power.”
Until recently, captive units could sell power only to the state-owned power transmission grid. Even that did not excite them as there were issues related to delayed payments and pricing. An amendment to the act that regulates the sector has deregulated the sale of captive capacity and now a captive generator can sell excess power in the market.
According to figures from the ministry of power, India has around 21,500MW of captive generation capacity, of which around 14,500MW is connected to the state-run grid. Of this, around 15-20% is not utilized. In other words, between 3,000MW and 4,000MM of power is not generated as the firms that own the units do not produce the power as there is no consumer for it. The traders are expected to tap this unutilized capacity. Some of the prominent players with captive capacity are ACC Ltd, Ambuja Cement Ltd, India Cement Ltd, Hindustan Petroleum Corp. Ltd and Ashok Leyland Ltd. More
Valia says he is talking to a slew of captive power generators in India who can be his customers, both as suppliers as well as buyers of power.
Valia is one of many who are exploring the possibility of trading on power through the online power trading platform, the Indian Energy Exchange (IEX), being set up by Financial Technologies Ltd under the aegis of the Central Electricity Regulatory Commission. It is expected to begin trading in next fiscal year.
“Many of them (captive generators) are not even utilizing the additional capacity they have because they are not in the business of trading power,” said Vaila. “Independent traders are negotiating with them to sell their additional power.”
Until recently, captive units could sell power only to the state-owned power transmission grid. Even that did not excite them as there were issues related to delayed payments and pricing. An amendment to the act that regulates the sector has deregulated the sale of captive capacity and now a captive generator can sell excess power in the market.
According to figures from the ministry of power, India has around 21,500MW of captive generation capacity, of which around 14,500MW is connected to the state-run grid. Of this, around 15-20% is not utilized. In other words, between 3,000MW and 4,000MM of power is not generated as the firms that own the units do not produce the power as there is no consumer for it. The traders are expected to tap this unutilized capacity. Some of the prominent players with captive capacity are ACC Ltd, Ambuja Cement Ltd, India Cement Ltd, Hindustan Petroleum Corp. Ltd and Ashok Leyland Ltd. More
Comments