IEX records 35.8% growth in August, renewable energy certificate segment surges 737% – EQ
In Short : The Indian Energy Exchange (IEX) reported a 35.8% growth in trading volume for August, driven by a significant increase in market activity. Notably, the renewable energy certificate (REC) segment experienced a remarkable 737% surge, reflecting the growing demand for green energy solutions. This substantial rise in REC trading underscores the accelerating shift towards renewable energy in India’s power sector.
In Detail : This spike was accompanied by an all-time low REC price of ₹115 per certificate during the trading session on August 28, 2024. Shares of Indian Energy Exchange Ltd ended at ₹205.90, up by ₹2.55, or 1.25%, on the BSE.
The Indian Energy Exchange (IEX) on Tuesday (September 3) saw significant growth in August 2024, achieving a total volume of 12,040 million units (MU), a 35.8% year-on-year (YoY) increase. The electricity volume alone reached 9,914 MU, marking a 17.1% YoY rise.
A notable highlight was the renewable energy certificate (REC) segment, which surged by 737.4% YoY to 2,116 MU. This spike was accompanied by an all-time low REC price of ₹115 per certificate during the trading session on August 28, 2024.
The decline in REC prices presents a strategic opportunity for obligated entities such as discoms (distribution companies) and captive power producers to fulfil their renewable purchase obligations (RPOs) more cost-effectively.
In the day-ahead market (DAM), volumes increased to 4,666 MU in August 2024, reflecting a 22.5% year-on-year growth from 3,810 MU in August 2023. The real-time electricity market (RTM) continued its upward trajectory, reaching a record monthly volume of 3,485 MU, up 27.3% YoY from 2,738 MU.
The RTM segment also achieved its highest-ever single-day trade of 156 MU on August 26, 2024, underscoring the market’s capacity to adapt quickly to fluctuating demand and supply conditions.
August 2024 saw a significant increase in hydro and wind power generation as the monsoon gained momentum, leading to enhanced availability of renewable energy in the system. This boost in renewable generation contributed to a notable decline in market prices.
The market clearing price in the DAM fell by approximately 38% YoY to ₹4.28 per unit, while the real-time market price dropped by 44.8% to ₹3.59 per unit compared to the year-ago period.
The overall decrease in prices highlights the impact of increased renewable energy supply on the market dynamics. Despite a 5% YoY decrease in India’s energy consumption, which stood at 144.2 billion units (BUs) in August 2024, IEX demonstrated resilience and adaptability in a challenging environment.
Shares of Indian Energy Exchange Ltd ended at ₹205.90, up by ₹2.55, or 1.25%, on the BSE.
