CERC Issues Regulations For Power Market

The Central Electricity Regulatory Commission (CERC) has recently issued the Draft Power Market Regulations, 2020.

These regulations shall be applied to Power Exchange, Market Participants and OTC Market.These regulations shall also be applied to contracts transacted on the Power Exchange, contracts relating to Renewable Energy Certificates, contracts relating to Energy Saving Certificates, contracts in the OTC Market. and any other contracts, as may be approved by the Commission.

The main feature of this regulations are introduction of forward contracts on Power Exchanges with mandatory physical delivery, introduction of OTC platforms to allow technology driven price dissemination for the buyers and sellers in the OTC Market, enabling provisions for Market Coupling among the Power Exchanges and minimum market share requirement for Power Exchanges has been removed.

Other then that the Net worth requirement for Power Exchanges has been increased to Rs. 50 crores, ownership and governance norms for Power Exchanges have been strengthened, clearing and settlement function of Power Exchanges to be done in accordance with provisions of the RBI, enhanced provisions for market oversight by the Commission, flexibility in the introduction of new bid types by Power Exchanges are been added.

The Commission shall also undertake inspection, conduct inquiries or audit of any Power Exchange anytime either through its officers or through a third-party agency, in accordance with the provisions of the Act and also exchange fee charged by Power Exchanges will also be  regulated by the Commission under this new regulation.

To know more about the regulation please refer to document below:

In June, The Central Electricity Regulatory Commission passed an order in regards to Removal of difficulties for giving effect to certain provisions of the Central Electricity Regulatory Commission (Deviation Settlement Mechanism and related matters) (Fifth Amendment) Regulations, 2014 .The Commission passed and order that the date of implementation of provisions and applicability of Regulation 7(10)(b) as amended vide DSM Fifth Amendment Regulations, shall be rescheduled from 1.6.2020 to 1.12.2020.