PTC India-led power exchange close to launch

Our Bureau Kolkata | Updated on September 26, 2019

Deepak Amitabh, CMD, PTC India   -  Debasish Bhaduri

On the lookout for more partners apart from BSE and ICICI Bank

The proposed electricity exchange to be formed by BSE, PTC India Ltd and ICICI Bank is at “an advanced stage” and awaiting clearance from power regulator Central Electricity Regulatory Commission.

A merchant banker has been appointed to bring more partners into the exchange, PTC India CMD Deepak Amitabh told newspersons on the sidelines of an environment and energy conclave organised by the Bengal Chamber of Commerce and Industry here on Thursday.

Last September, BSE, PTC India and ICICI Bank had come together to form the country’s third electricity exchange after Power Exchange of India (PXIL) and India Energy Exchange (IEX).

While the company has already been formed, discussions are on to bring in exchange partners from across the industry including generators, distribution companies and financiers.

Under power market regulation, PTC India cannot hold more than 5 per cent in the exchange while the RBI does not permit any bank to hold more than 10 per cent. This apart, no entity can hold more than 25 per cent in the proposed exchange, so the remaining 60 per cent stake in the company has to be divested to a diverse class of investors.

“So that is what we are inducting now — we are in dialogue with a lot of people to be exchange partners...generators, distribution companies, etc. The dialogue is going on and once they confirm then CERC should allow us to set up,” said Amitabh.

A power exchange, which also largely functions on the lines of commodity exchanges, typically provides a platform for buyers, sellers and traders of electricity to enter into spot contracts. Such contracts can be for the same day, next day, or on a weekly basis. This apart, it also provides a payment security mechanism to buyers and sellers.

Power exchanges are expected to witness a spurt in activity due to the changing dynamics of power trading toward short-term contracts instead of long-term power purchase agreements.

Published on August 29, 2019

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