Power Exchange Prices Fall 31% in Oct-Nov Due to Renewable Energy Push

03 Dec 2024

The average price of electricity traded on India's power exchanges in October-November 2024 fell by 31% compared to the previous year, reaching ?3.61 per unit in the Day-Ahead Market (DAM), down from ?5.23 per unit during the same period last year. Likewise, real-time market (RTM) prices fell by 29%, reaching ?3.59 per unit, down from ?5.04 per unit a year earlier, as per industry data.

The fall in prices is attributed to the rise in renewable energy generation, especially hydro and wind power, aided by favourable monsoon conditions. Government-led initiatives to increase fuel availability and enhance selling liquidity on exchange platforms also played a key role in stabilising prices.

Significant Drop in Minimum Prices

In the DAM, the minimum price during October-November 2024 dropped by 67%, reaching ?0.49 per unit, down from ?1.5 per unit in the same period last year. The minimum prices in the RTM also saw a decline, falling by 14% to ?3.41 per unit, compared to ?3.98 per unit last year. Notably, the maximum price in the DAM remained stable at ?10 per unit, while in the RTM, the peak price decreased by 38% year-on-year, falling to ?3.77 per unit from ?6.1 per unit.

The decline in prices intensified in the third quarter compared to the first half of the fiscal year. From April to September, DAM prices dropped by 12%, while RTM prices decreased by 13%, reflecting a more pronounced correction in Q3.