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Analysis of weekly reports
received from traders
(OCTOBER 2013)

[An analysis of all weekly reports for 30th September – 3rd November 2013 received from
licensed-traders]

Economics and Power Market Division
Market Monitoring Cell
Central Electricity Regulatory Commission

Prepared on 8th November 2013
1
Snapshot for October 2013
 The reported short-term contract volume for
October 2013 (analysis of five weeks) is 2262
MUs whereas the same was 1529 MUs for the
month of for September 2013 (analysis of four
weeks). This is equivalent to about 18% increase
in average weekly volume transacted during
September.
 85% of total volume has been contracted at price
of more than `4/kWh during October as compared
to

36%

of

total

volume

contracted

during

September.
 Total number of contracts (including swap &
banking) executed during October is 273 by 9
traders whereas in September the number of
contracts executed was 180 by 9 traders.

2
I.

Comparison of Short Term OTC contracts prices with Power Exchange
prices (on Contracted Date)
The scatter diagram shows a comparative analysis of price movement in OTC and Power
Exchange markets for October 2013. As seen in scatter diagram, the contracts executed are
almost evenly distributed with the maximum number of contracts executed in the first
week of the period (refer to annexure I for contracts executed week-wise) and the overall
price of OTC contracts executed was in the range of `2.02/kWh - `6.66/kWh whereas the
prices on the Exchanges varied between `1.89/kWh - `3.47/kWh

Chart 1: Scatter Diagram depicting price of electricity in OTC contracts and in Power Exchanges
Contracts for less than a week

Contracts for 1 week & upto 1 month

Contracts for 1 month & upto 3 months

Contracts for 3 months & upto 12 months

IEX

PXIL

7
6.5
6
5.5
`/kWh

5
4.5
4
3.5
3
2.5
2
1.5
29-Sep
30-Sep
1-Oct
2-Oct
3-Oct
4-Oct
5-Oct
6-Oct
7-Oct
8-Oct
9-Oct
10-Oct
11-Oct
12-Oct
13-Oct
14-Oct
15-Oct
16-Oct
17-Oct
18-Oct
19-Oct
20-Oct
21-Oct
22-Oct
23-Oct
24-Oct
25-Oct
26-Oct
27-Oct
28-Oct
29-Oct
30-Oct
31-Oct
1-Nov
2-Nov
3-Nov
4-Nov

1

Contract Date
Note: It may be noted that Power Exchange is a day ahead market with standardized contracts with no transmission corridor reservation
while the OTC Contracts are weekly/monthly contracts with flexibility of customization and corridor reservation. The price comparison
of OTC and Power Exchanges contracts should be seen in this light.

Table 1 on the subsequent page shows week-wise sale prices and total contracted volume
reported by traders. Table 2 shows comparison between price discovered on Exchanges and
price of contracts executed in OTC market.
3
Table 1: Price and Volume of OTC Contracts
Range of Sale Price
(`/kWh)

Week

Min

Max

2.41
2.02
2.31
2.52
2.52

30th Sep - 6th Oct
7th Oct - 13th Oct
14th Oct - 20th Oct
21st Oct - 27th Oct
28th Oct - 3rd Nov
Gross

Weighted
Average of
Sale Price
(`/kWh)

5.27
6.06
5.27
5.27
6.66

Total
Volume
(MUs)

4.03
4.93
3.55
4.04
4.23
4.26

487.82
379.36
33.29
416.45
838.85
2155.77

IEX*
(`/kWh)
PXIL*
(`/kWh)

13-Oct-13

12-Oct-13

11-Oct-13

10-Oct-13

9-Oct-13

8-Oct-13

7-Oct-13

6-Oct-13

2.91

2.83

2.65

3.01

3.15

3.20

3.18

3.08

2.91

2.68

2.62

2.69

2.53

2.59

2.52

2.35

2.36

2.41

2.58

2.82

2.88

2.67

2.47

2.08

1.89

27-Oct-13

26-Oct-13

25-Oct-13

24-Oct-13

23-Oct-13

22-Oct-13

21-Oct-13

20-Oct-13

19-Oct-13

4.93

18-Oct-13

16-Oct-13

15-Oct-13

14-Oct-13

4.03

2.76

2.95

2.94

2.92

3.47

2.46

3.00

2.94

3.15

2.39

2.54

2.55

2.76

2.82

2.05

2.23

2.30

2.57

2.40

2.17

2.32

2.42

2.34

2.34

2.36

2.46

2.38

2.44

30-Oct-13

31-Oct-13

1-Nov-13

2-Nov-13

3-Nov-13

4.04

29-Oct-13

3.55

28-Oct-13

IEX*
(`/kWh)
PXIL*
(`/kWh)
OTC
Contract**
(`/kWh)

5-Oct-13

2.94

OTC
Contract**
(`/kWh)

Contract
Date

4-Oct-13

2.98

OTC
Contract**
(`/kWh)

Contract
Date

3-Oct-13

2-Oct-13

2.85

17-Oct-13

IEX*
(`/kWh)
PXIL*
(`/kWh)

1-Oct-13

Contract
Date

30-Sep-13

Table 2 Comparison of prices in Day Ahead Market and in OTC Contracts

2.66

3.00

2.82

2.91

3.04

2.61

2.42

2.48

2.66

2.45

2.66

2.66

2.67

2.37

4.23

4
Observations
1. It is observed that weighted average OTC contract prices were always higher than
average daily prices on Exchanges during the reporting period. The minimum price in
OTC market was `2.02/kWh (12th October 2013) while on the exchanges it was
`1.89/kWh (PXIL, 13th October 2013) and the maximum price in OTC market was
`6.66/kWh (29th October, 2013) for ‘Peak’ contract while for Day-Ahead market on the
exchange the maximum price was `3.47/kWh (IEX, 18th October 2013). (It may be noted
that Power Exchange is a day ahead market with standardized contracts with no transmission
corridor reservation while the OTC Contracts are weekly/monthly contracts with flexibility of
customization and transmission corridor reservation. The price comparison of OTC - Contracts and
Power Exchanges should be seen in this light.)
2. As far as the number of contracts is concerned, 35 out of 247 contracts were entered
at sale price above `4/kWh. However, the cumulative volume traded at price above
`4/kWh was 1827 MUs which is 85% of total OTC contracts volume for October
2013. There were a total 273 contracts including swap & banking reported for the
period.

Chart 2: Frequency distribution of number & volume of OTC contracts
1600.00

200

1400.00

180
160

Volume (MUs)

1200.00

140

1000.00

120

800.00

100

600.00

80
60

400.00

40

200.00
0.00
Price range (`/kwh)
Volume
No. of contracts

20
0-3

3-3.5

3.5-4

4-4.5

4.5-5

5-5.5

Above
5.5

115.02

152.13

61.61

1478.46

0.00

164.65

183.90

173

25

14

28

0

5

0

2

Excluding swap /banking contracts since they do not have any sale price.

5
3. The following chart shows the percentage of contracts reported during the aforesaid
period, categorized according to the period of power supply. Total number of
contracts reported is 273. It can be observed that majority of the contracts executed
were for a period of less than a week followed by contracts executed for duration of 1
month to 3 months.
Chart 3: Percentage of contracts as per duration of power supply contracted in October 2013

6%

8%

Less than a week
One week and upto one month
86%

One month and upto 3 months

6
II. Forward Curve of Power Prices
A forward curve reflects present day’s expectation of spot prices for a future period. Accordingly
forward curves have been drawn based on prices of contracts executed for supply of power for
future period. Forward curve have been drawn for November 2013 – May 2014 based on 247
contracts and for comparison forward curve has been drawn for October 2013 – May 2014 based
on 168 contracts.
Chart 4.1: Forward Curve for the period November 2013 –May 2014
4.900
4.828
4.700

Price (`/Kwh)

4.500

4.385

4.387

4.300
4.100
3.845

3.900
3.700
3.500
8-Nov-13

8-Dec-13

8-Jan-14

8-Feb-14

8-Mar-14

8-Apr-14

8-May-14

Delivery Date
Weighted average contract price

Chart 4.2: Forward Curve for the period October 2013 – May 2014
4.900
4.828

Price (`/Kwh)

4.700
4.500

4.386

4.386

4.300
4.100
3.900

3.845

3.700
3.500
11-Oct-13

11-Nov-13 11-Dec-13

11-Jan-14

11-Feb-14 11-Mar-14

11-Apr-14 11-May-14

Delivery Date
Weighted average contract price

7
Observations
1. The Forward Curve for October 2013 is based on reported contracts for the period up to
3rd November 2013 and the tenure of the curve is for the period 8th November 2013 to 31st
May 2014 (period of power delivery). The forward prices for November & December
2013 are based on 24 and 17 contracts respectively whereas the forward prices for April
& May 2014 are based on only 2-4 contracts. Therefore, the liquidity is high in terms of
number of contracts in the nearer months in comparison to farther months and
therefore the price indicators are better for nearer months.
2. A comparison of forward curves (Charts 4.1 & 4.2) gives us a picture of expected
delivery price as on 8th November 2013 (Chart 4.1), vis a vis the expected delivery price
last month, as was on 11th October 2013 (Chart 4.2). In general, the nature of both
forward curves drawn in October and November 2013 are similar. This similarity is
because the cumulative volume contracted in months prior to the current reporting
period for the delivery period November 2013 – May 2014 far outweighs the volume
contracted in the October 2013 for the delivery months November 2013 – May 2014.

8
III. Post-facto Comparison of Prices in OTC Contracts and in Power
Exchanges (on Power Delivery Dates)
The post facto graph shows the average OTC price vis-à-vis power exchanges prices for
the last month’s power deliveries. Hence this compares the spot Power Exchange prices
with OTC deliveries (OTC contracts may have been executed earlier but delivered on the
same days as on the exchange spot deliveries). The methodology of calculating the data
points of OTC prices is same as in the forward curve.
Chart 5: Comparison OTC Delivery price and Power Exchange Spot Delivery Price for October 2013
5.00
4.38

4.50
4.00
Price (`/kWh)

3.50
3.00
2.50

3.47
2.83
2.86

2.83

2.54

2.47

2.39
2.46

2.17

2.00

1.89

1.50
1.00
0.50
0.00

Delivery Dates
Daily Weighted Average OTC price

IEX Average Daily Area Price

PXIL Average Daily Area Price

Observations
1. Weighted average delivery price of OTC contracts are almost constant at `4.38/kWh while
the prices in power exchanges have fluctuated over a range of `1.89/kWh to `3.47/ kWh. It
can be seen that the weighted average OTC contracts prices were always higher than the
power exchange average daily area prices. (It may be noted that Power Exchange is a day ahead
market with standardized contracts with no transmission corridor reservation while the OTC - Contracts
are weekly/monthly contracts with flexibility of customization and transmission corridor reservation. The
price comparison of OTC - Contracts and Power Exchanges should be seen in this light.)
9
Annexure-I: List of traders who have undertaken contracts in October 2013*
Trader

30th Sep 6th Oct

7th Oct 13th Oct

14th Oct 20th Oct

21st Oct 27th Oct

28th Oct 3rd Nov

Grand
Total

PTC India Ltd.
NTPC Vidyut Vyapar
Nigam Ltd.

Y(49)
Y(11)

Y(44)
Y(4)

Y(38)
Y(7)

Y(36)
Y(8)

Y(41)
Y(6)

Y(208)
Y(36)

Tata Power Trading Co.
Ltd.
JSW Power Trading
Company Ltd.

Y(4)

NIL

Y(2)

Y(9)

Y(2)

Y(17)

NIL

Y(2)

NIL

Y(1)

Y(1)

Y(4)

Instinct Infra & Power
Ltd.
Mittal Processors (P)
Ltd
National Energy
Trading & Services Ltd.

Y(2)

Y(1)

NIL

NIL

NR

Y(3)

Y(2)

NIL

NR

NR

Y(2)

NIL

Y(1)

Y(1)

Shree Cement Ltd
Grand Total

NIL

NIL

NIL

NIL

Reliance Energy
Trading (P) Ltd.

Note 1:

NR

NIL

NIL

Y(1)

NIL

Y(1)

NIL
Y(68)

NIL
Y(51)

NIL
Y(47)

Y(1)
Y(56)

NR
Y(51)

Y(1)
Y(273)

Y ( ): Contracts had been undertaken (Number of Contracts)
NIL: No Contracts was made during the week
NR: Not Reported

*Note 2:

This table shows list of traders who have reported & undertaken at least one contract
during the reported period. There could be some traders who have reported but did not
undertake any contracts.

10
Annexure-II: Process of Formulation
I.

The Scatter Diagram: Comparison of prices of Short Term OTC

Contracts with Power Exchange Prices ( on Contracted Date)
The scatter diagram represents the details of OTC contracts undertaken by traders
during any particular time period (e.g. for last four or five weeks) for short-term (up
to an year) transactions of electricity. Each data-point represents contract sale-price
on a particular contract date.
The varied shapes are to depict contracts for different time-span, e.g. the diamonds
are for contracts for less than a week, the squares are for contracts which have been
made for one week or up to one month ahead, the triangles are to represent contracts
made for a month or more but for less than three months and the crosses are for three
months or up to an year of contracts. In the diagram, no distinction has been made
among the traders. The black and red markers connected with lines show the spot
prices at the two power exchanges, viz. the Indian Energy Exchange (IEX) and the
Power Exchange of India Ltd. (PXIL) on the respective contract dates.

II. The Forward Curve of Power Price
The forward curve has been made based on OTC sale prices reported every week by
the traders. For a contract of a full month, the average monthly contract price is
considered discretely as the price for each day. Finally, the average daily price for the
forward curve is the weighted average daily price for all contracts existing in these
days. (Weights being the respective contracted daily volume).

III. The Post-Facto Graph: Post-facto Comparison of Prices in OTC
Contracts and Power Exchanges (on Power Delivery Dates)
The post facto graph shows the comparison of daily average OTC price vis-à-vis
average daily area power exchanges prices for the last month’s daily power deliveries.
Daily average OTC price is calculated by considering all OTC contracts including
daily, weekly, monthly and more than 3-month and up to one year contracts
delivered in the period. The average daily price is the weighted average daily price for
all contracts delivered on that day. (Weights being the respective contracted daily
volume). For example for a weekly contract the same price is considered for
11
discretely as the price for each day of the week, for monthly contract the same price
is considered discretely as the price for each day of the month. Then the daily volume
weighted average of these weekly/monthly, as the case may be, is calculated and
termed a daily average OTC price.
IV. The difference between Scatter Diagram and Post Facto Graph is as follows:
a) The scatter diagram represents the details of OTC contracts undertaken by
traders during any particular time period (e.g. for last five weeks) for shortterm (upto less than a year) transactions of electricity. Each data-point
represents contract sale-price on a particular contract date.
b) The post facto graph shows the average OTC price vis-à-vis power exchanges
prices for the last month’s power deliveries. It gives a comparison between
the spot delivered prices and OTC deliveries (OTC contracts may have been
executed earlier but delivery was scheduled for the said dates).
V. The 96 Blocks (24 hours) average prices of the 12 bid areas is being termed as
average daily area price. The Power Exchanges’ prices used in the report are
calculated using following formulas:
Average Daily Area Price (`/kWh)

Where Pi is the price for different 15 minute time blocks in a day

12

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Analysis of Trading activities by Licensed Traders for October 2013

  • 1. Analysis of weekly reports received from traders (OCTOBER 2013) [An analysis of all weekly reports for 30th September – 3rd November 2013 received from licensed-traders] Economics and Power Market Division Market Monitoring Cell Central Electricity Regulatory Commission Prepared on 8th November 2013 1
  • 2. Snapshot for October 2013  The reported short-term contract volume for October 2013 (analysis of five weeks) is 2262 MUs whereas the same was 1529 MUs for the month of for September 2013 (analysis of four weeks). This is equivalent to about 18% increase in average weekly volume transacted during September.  85% of total volume has been contracted at price of more than `4/kWh during October as compared to 36% of total volume contracted during September.  Total number of contracts (including swap & banking) executed during October is 273 by 9 traders whereas in September the number of contracts executed was 180 by 9 traders. 2
  • 3. I. Comparison of Short Term OTC contracts prices with Power Exchange prices (on Contracted Date) The scatter diagram shows a comparative analysis of price movement in OTC and Power Exchange markets for October 2013. As seen in scatter diagram, the contracts executed are almost evenly distributed with the maximum number of contracts executed in the first week of the period (refer to annexure I for contracts executed week-wise) and the overall price of OTC contracts executed was in the range of `2.02/kWh - `6.66/kWh whereas the prices on the Exchanges varied between `1.89/kWh - `3.47/kWh Chart 1: Scatter Diagram depicting price of electricity in OTC contracts and in Power Exchanges Contracts for less than a week Contracts for 1 week & upto 1 month Contracts for 1 month & upto 3 months Contracts for 3 months & upto 12 months IEX PXIL 7 6.5 6 5.5 `/kWh 5 4.5 4 3.5 3 2.5 2 1.5 29-Sep 30-Sep 1-Oct 2-Oct 3-Oct 4-Oct 5-Oct 6-Oct 7-Oct 8-Oct 9-Oct 10-Oct 11-Oct 12-Oct 13-Oct 14-Oct 15-Oct 16-Oct 17-Oct 18-Oct 19-Oct 20-Oct 21-Oct 22-Oct 23-Oct 24-Oct 25-Oct 26-Oct 27-Oct 28-Oct 29-Oct 30-Oct 31-Oct 1-Nov 2-Nov 3-Nov 4-Nov 1 Contract Date Note: It may be noted that Power Exchange is a day ahead market with standardized contracts with no transmission corridor reservation while the OTC Contracts are weekly/monthly contracts with flexibility of customization and corridor reservation. The price comparison of OTC and Power Exchanges contracts should be seen in this light. Table 1 on the subsequent page shows week-wise sale prices and total contracted volume reported by traders. Table 2 shows comparison between price discovered on Exchanges and price of contracts executed in OTC market. 3
  • 4. Table 1: Price and Volume of OTC Contracts Range of Sale Price (`/kWh) Week Min Max 2.41 2.02 2.31 2.52 2.52 30th Sep - 6th Oct 7th Oct - 13th Oct 14th Oct - 20th Oct 21st Oct - 27th Oct 28th Oct - 3rd Nov Gross Weighted Average of Sale Price (`/kWh) 5.27 6.06 5.27 5.27 6.66 Total Volume (MUs) 4.03 4.93 3.55 4.04 4.23 4.26 487.82 379.36 33.29 416.45 838.85 2155.77 IEX* (`/kWh) PXIL* (`/kWh) 13-Oct-13 12-Oct-13 11-Oct-13 10-Oct-13 9-Oct-13 8-Oct-13 7-Oct-13 6-Oct-13 2.91 2.83 2.65 3.01 3.15 3.20 3.18 3.08 2.91 2.68 2.62 2.69 2.53 2.59 2.52 2.35 2.36 2.41 2.58 2.82 2.88 2.67 2.47 2.08 1.89 27-Oct-13 26-Oct-13 25-Oct-13 24-Oct-13 23-Oct-13 22-Oct-13 21-Oct-13 20-Oct-13 19-Oct-13 4.93 18-Oct-13 16-Oct-13 15-Oct-13 14-Oct-13 4.03 2.76 2.95 2.94 2.92 3.47 2.46 3.00 2.94 3.15 2.39 2.54 2.55 2.76 2.82 2.05 2.23 2.30 2.57 2.40 2.17 2.32 2.42 2.34 2.34 2.36 2.46 2.38 2.44 30-Oct-13 31-Oct-13 1-Nov-13 2-Nov-13 3-Nov-13 4.04 29-Oct-13 3.55 28-Oct-13 IEX* (`/kWh) PXIL* (`/kWh) OTC Contract** (`/kWh) 5-Oct-13 2.94 OTC Contract** (`/kWh) Contract Date 4-Oct-13 2.98 OTC Contract** (`/kWh) Contract Date 3-Oct-13 2-Oct-13 2.85 17-Oct-13 IEX* (`/kWh) PXIL* (`/kWh) 1-Oct-13 Contract Date 30-Sep-13 Table 2 Comparison of prices in Day Ahead Market and in OTC Contracts 2.66 3.00 2.82 2.91 3.04 2.61 2.42 2.48 2.66 2.45 2.66 2.66 2.67 2.37 4.23 4
  • 5. Observations 1. It is observed that weighted average OTC contract prices were always higher than average daily prices on Exchanges during the reporting period. The minimum price in OTC market was `2.02/kWh (12th October 2013) while on the exchanges it was `1.89/kWh (PXIL, 13th October 2013) and the maximum price in OTC market was `6.66/kWh (29th October, 2013) for ‘Peak’ contract while for Day-Ahead market on the exchange the maximum price was `3.47/kWh (IEX, 18th October 2013). (It may be noted that Power Exchange is a day ahead market with standardized contracts with no transmission corridor reservation while the OTC Contracts are weekly/monthly contracts with flexibility of customization and transmission corridor reservation. The price comparison of OTC - Contracts and Power Exchanges should be seen in this light.) 2. As far as the number of contracts is concerned, 35 out of 247 contracts were entered at sale price above `4/kWh. However, the cumulative volume traded at price above `4/kWh was 1827 MUs which is 85% of total OTC contracts volume for October 2013. There were a total 273 contracts including swap & banking reported for the period. Chart 2: Frequency distribution of number & volume of OTC contracts 1600.00 200 1400.00 180 160 Volume (MUs) 1200.00 140 1000.00 120 800.00 100 600.00 80 60 400.00 40 200.00 0.00 Price range (`/kwh) Volume No. of contracts 20 0-3 3-3.5 3.5-4 4-4.5 4.5-5 5-5.5 Above 5.5 115.02 152.13 61.61 1478.46 0.00 164.65 183.90 173 25 14 28 0 5 0 2 Excluding swap /banking contracts since they do not have any sale price. 5
  • 6. 3. The following chart shows the percentage of contracts reported during the aforesaid period, categorized according to the period of power supply. Total number of contracts reported is 273. It can be observed that majority of the contracts executed were for a period of less than a week followed by contracts executed for duration of 1 month to 3 months. Chart 3: Percentage of contracts as per duration of power supply contracted in October 2013 6% 8% Less than a week One week and upto one month 86% One month and upto 3 months 6
  • 7. II. Forward Curve of Power Prices A forward curve reflects present day’s expectation of spot prices for a future period. Accordingly forward curves have been drawn based on prices of contracts executed for supply of power for future period. Forward curve have been drawn for November 2013 – May 2014 based on 247 contracts and for comparison forward curve has been drawn for October 2013 – May 2014 based on 168 contracts. Chart 4.1: Forward Curve for the period November 2013 –May 2014 4.900 4.828 4.700 Price (`/Kwh) 4.500 4.385 4.387 4.300 4.100 3.845 3.900 3.700 3.500 8-Nov-13 8-Dec-13 8-Jan-14 8-Feb-14 8-Mar-14 8-Apr-14 8-May-14 Delivery Date Weighted average contract price Chart 4.2: Forward Curve for the period October 2013 – May 2014 4.900 4.828 Price (`/Kwh) 4.700 4.500 4.386 4.386 4.300 4.100 3.900 3.845 3.700 3.500 11-Oct-13 11-Nov-13 11-Dec-13 11-Jan-14 11-Feb-14 11-Mar-14 11-Apr-14 11-May-14 Delivery Date Weighted average contract price 7
  • 8. Observations 1. The Forward Curve for October 2013 is based on reported contracts for the period up to 3rd November 2013 and the tenure of the curve is for the period 8th November 2013 to 31st May 2014 (period of power delivery). The forward prices for November & December 2013 are based on 24 and 17 contracts respectively whereas the forward prices for April & May 2014 are based on only 2-4 contracts. Therefore, the liquidity is high in terms of number of contracts in the nearer months in comparison to farther months and therefore the price indicators are better for nearer months. 2. A comparison of forward curves (Charts 4.1 & 4.2) gives us a picture of expected delivery price as on 8th November 2013 (Chart 4.1), vis a vis the expected delivery price last month, as was on 11th October 2013 (Chart 4.2). In general, the nature of both forward curves drawn in October and November 2013 are similar. This similarity is because the cumulative volume contracted in months prior to the current reporting period for the delivery period November 2013 – May 2014 far outweighs the volume contracted in the October 2013 for the delivery months November 2013 – May 2014. 8
  • 9. III. Post-facto Comparison of Prices in OTC Contracts and in Power Exchanges (on Power Delivery Dates) The post facto graph shows the average OTC price vis-à-vis power exchanges prices for the last month’s power deliveries. Hence this compares the spot Power Exchange prices with OTC deliveries (OTC contracts may have been executed earlier but delivered on the same days as on the exchange spot deliveries). The methodology of calculating the data points of OTC prices is same as in the forward curve. Chart 5: Comparison OTC Delivery price and Power Exchange Spot Delivery Price for October 2013 5.00 4.38 4.50 4.00 Price (`/kWh) 3.50 3.00 2.50 3.47 2.83 2.86 2.83 2.54 2.47 2.39 2.46 2.17 2.00 1.89 1.50 1.00 0.50 0.00 Delivery Dates Daily Weighted Average OTC price IEX Average Daily Area Price PXIL Average Daily Area Price Observations 1. Weighted average delivery price of OTC contracts are almost constant at `4.38/kWh while the prices in power exchanges have fluctuated over a range of `1.89/kWh to `3.47/ kWh. It can be seen that the weighted average OTC contracts prices were always higher than the power exchange average daily area prices. (It may be noted that Power Exchange is a day ahead market with standardized contracts with no transmission corridor reservation while the OTC - Contracts are weekly/monthly contracts with flexibility of customization and transmission corridor reservation. The price comparison of OTC - Contracts and Power Exchanges should be seen in this light.) 9
  • 10. Annexure-I: List of traders who have undertaken contracts in October 2013* Trader 30th Sep 6th Oct 7th Oct 13th Oct 14th Oct 20th Oct 21st Oct 27th Oct 28th Oct 3rd Nov Grand Total PTC India Ltd. NTPC Vidyut Vyapar Nigam Ltd. Y(49) Y(11) Y(44) Y(4) Y(38) Y(7) Y(36) Y(8) Y(41) Y(6) Y(208) Y(36) Tata Power Trading Co. Ltd. JSW Power Trading Company Ltd. Y(4) NIL Y(2) Y(9) Y(2) Y(17) NIL Y(2) NIL Y(1) Y(1) Y(4) Instinct Infra & Power Ltd. Mittal Processors (P) Ltd National Energy Trading & Services Ltd. Y(2) Y(1) NIL NIL NR Y(3) Y(2) NIL NR NR Y(2) NIL Y(1) Y(1) Shree Cement Ltd Grand Total NIL NIL NIL NIL Reliance Energy Trading (P) Ltd. Note 1: NR NIL NIL Y(1) NIL Y(1) NIL Y(68) NIL Y(51) NIL Y(47) Y(1) Y(56) NR Y(51) Y(1) Y(273) Y ( ): Contracts had been undertaken (Number of Contracts) NIL: No Contracts was made during the week NR: Not Reported *Note 2: This table shows list of traders who have reported & undertaken at least one contract during the reported period. There could be some traders who have reported but did not undertake any contracts. 10
  • 11. Annexure-II: Process of Formulation I. The Scatter Diagram: Comparison of prices of Short Term OTC Contracts with Power Exchange Prices ( on Contracted Date) The scatter diagram represents the details of OTC contracts undertaken by traders during any particular time period (e.g. for last four or five weeks) for short-term (up to an year) transactions of electricity. Each data-point represents contract sale-price on a particular contract date. The varied shapes are to depict contracts for different time-span, e.g. the diamonds are for contracts for less than a week, the squares are for contracts which have been made for one week or up to one month ahead, the triangles are to represent contracts made for a month or more but for less than three months and the crosses are for three months or up to an year of contracts. In the diagram, no distinction has been made among the traders. The black and red markers connected with lines show the spot prices at the two power exchanges, viz. the Indian Energy Exchange (IEX) and the Power Exchange of India Ltd. (PXIL) on the respective contract dates. II. The Forward Curve of Power Price The forward curve has been made based on OTC sale prices reported every week by the traders. For a contract of a full month, the average monthly contract price is considered discretely as the price for each day. Finally, the average daily price for the forward curve is the weighted average daily price for all contracts existing in these days. (Weights being the respective contracted daily volume). III. The Post-Facto Graph: Post-facto Comparison of Prices in OTC Contracts and Power Exchanges (on Power Delivery Dates) The post facto graph shows the comparison of daily average OTC price vis-à-vis average daily area power exchanges prices for the last month’s daily power deliveries. Daily average OTC price is calculated by considering all OTC contracts including daily, weekly, monthly and more than 3-month and up to one year contracts delivered in the period. The average daily price is the weighted average daily price for all contracts delivered on that day. (Weights being the respective contracted daily volume). For example for a weekly contract the same price is considered for 11
  • 12. discretely as the price for each day of the week, for monthly contract the same price is considered discretely as the price for each day of the month. Then the daily volume weighted average of these weekly/monthly, as the case may be, is calculated and termed a daily average OTC price. IV. The difference between Scatter Diagram and Post Facto Graph is as follows: a) The scatter diagram represents the details of OTC contracts undertaken by traders during any particular time period (e.g. for last five weeks) for shortterm (upto less than a year) transactions of electricity. Each data-point represents contract sale-price on a particular contract date. b) The post facto graph shows the average OTC price vis-à-vis power exchanges prices for the last month’s power deliveries. It gives a comparison between the spot delivered prices and OTC deliveries (OTC contracts may have been executed earlier but delivery was scheduled for the said dates). V. The 96 Blocks (24 hours) average prices of the 12 bid areas is being termed as average daily area price. The Power Exchanges’ prices used in the report are calculated using following formulas: Average Daily Area Price (`/kWh) Where Pi is the price for different 15 minute time blocks in a day 12