IIT Kanpur's Centre for Energy Regulation Conducts Dialogue on Power Market Derivatives
The Centre for Energy Regulation (CER), Indian Institute of Technology Kanpur organized a Stakeholder Consultation Workshop on “Developing Power Market Derivatives for the Indian Power Sector.” The event held at the India Habitat Centre, New Delhi was a step to address the evolving dynamics of the Indian Power Sector. It brought together key stakeholders to explore innovative solutions and develop risk mitigation strategies amidst the growing share of renewables and market volatility.
Srikant Nagulapalli, Additional Secretary of the Ministry of Power, delivered the Keynote Address. He acknowledged CER”s accomplishments in the study and highlighted the government”s initiatives for Renewable Energy (RE) integration and market development.
Expert Panel Discussions
The event featured two insightful panel discussions and deliberations among esteemed industry professionals. The first panel had representatives from the Central Electricity Authority, PTC India Ltd, Indian Energy Exchange, and EY Parthenon. They discussed on the theme “Identifying Risks and Hedging Avenues in the Indian Power Market: Role of Derivatives.”
The second panel delved into the “Regulatory Framework for Power Market Derivatives,”. Eminent panellists from the Punjab State Electricity Regulatory Commission, Central Electricity Regulatory Commission, Grid India, Securities and Exchange Board of India, and The Lantau Group offered valuable insights and perspectives on this critical aspect.
Key Highlights of the Workshop
The discussions underscored the pivotal role of derivatives in power market development and the need to enhance understanding among key stakeholders, particularly distribution companies. These entities could leverage such instruments to effectively hedge their exposure to short-term power market volatility, ensuring greater stability and risk mitigation.
The outcomes of the CER’s ongoing study were presented by Professor Anoop Singh, Department of Management Sciences, IIT Kanpur. Professor Singh shared insights into derivative product design, regulatory frameworks, and policy implications vital for successful implementation of power market derivatives in the country. He proposed an innovative approach to facilitate sector-wide participation in financially settled and physically delivered derivatives. Prof. Singh also discussed on how to mitigate risks encountered by DISCOMs, Open Access Consumers, and Thermal/RE generators.
The workshop concluded with a consensus on the potential of power derivatives to enhance market efficiency and manage risks in the Indian power sector. CER”s pioneering initiative garnered appreciation from attendees for its timely and comprehensive approach to addressing the sector”s evolving challenges, encouraging dialogue, and exploring innovative solutions for a sustainable and resilient power ecosystem.
Notably, Indian Institute of Technology Kanpur was established in 1959 and best known for the highest standard of education in science and engineering and for seminal R&D contributions over the years.
