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Increase in Power Price at IEX: An Opportunity for IPPs

News:

Power demand has crossed the 1.50 lakh MW level for the first time because of increased farm demand and reduced generation from hydel power stations as the monsoon recedes, pushing electricity prices on the Indian Energy Exchange (IEX) to a record.

Source:- ET

SNP Insight: 

The increased power demand has in turn provided the opportunity to Independent Power Producers with domestic coal to sell power in open market. However given the short term need to meet the power demand from agriculture sector the expected return is lower. Also the other existing coal based thermal power plants with lower PLFs have the opportunity to increase their power generation with sufficient coal supplies available to them. 

Source:- SNP Infra Research