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Open Access and Trading

Open Access and Trading

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Open Access and Trading

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  1. Open Access and Trading

  2. Trading “Trading" means purchase of electricity for resale thereof” • Any person is allowed to undertake trading in electricity provided he has authorized licence issued under Section 14 or is exempted under Section 13 • Appropriate Commission may specify trading margin, if needed. CERC has specified 4 paise/kwh as trading margin • 27 Traders have been issued Trading Licenses by CERC for carrying out Inter State Trading.

  3. Legal Framework For Trading Section 12 : No person shall undertake trading in electricity unless he is authorized to do so by license issued under Section 14, or is exempt under Section 13. Section 13 : The provisions of Section 12 shall not apply to any local authority, Panchayat Institution, users’ association, co-operative societies, non-governmental organizations, or Franchisees. Section 14 : The Appropriate Commission may, on application made to it, grant any person license to any person to undertake Trading in electricity as an electricity trader in any area which may be specified in the license.

  4. Legal Framework For Trading Section 52 : 1.The Appropriate Commission may specify the technical requirement, capital adequacy requirement and credit worthiness for being an electricity trader. 2.Every electricity trader shall discharge such duties, in relation to supply and trading in electricity, as may be specified by the Appropriate Commission.

  5. Highlights of Regulations for Inter State Trading • Allows Bilateral Trading between the Generating Company including CPP, Distribution Licensee and Electricity Trader on the one hand and the electricity trader and the distribution licensee on the other • The Inter-State Trading Licence shall be granted for 25 years • The application fee is Rs. 1.00 lakh which is subject to adjustment after the same is prescribed by the Central Government • Specifies the methodology for publication of the licence application

  6. Contd … • The technical; requirements for being an electricity trader stipulates having at least one full time professional each with experience in - Power System Operations and commercial aspects of power transfers - Finance, Commerce and Accounts • Six Categories of Trading Licences


  8. Trading Relationship Generating Cos. Traders Distribution Cos.

  9. DEFINITION OF “OPEN ACCESS” IN THE ELECTRICITY ACT, 2003 “The non-discriminatory provision for the use of transmission lines or distribution system or associated facilities with such lines or system by any licensee or consumer or a person engaged in generation in accordance with the regulations specified by the Appropriate Commission”

  10. INTRODUCTION • Open Access is necessary for utilization of short time surpluses. • Open Access will also create options for distribution companies to buy power. • Open Access will provide means to the traders/buyers/sellers. • Non- discriminatory / Transparent Process • Freedom to buy/sell power • Efficient Market Mechanism to address supply / demand mismatches • Encourage investment in Transmission

  11. Legal Framework SECTION 38: (CTU Function) • CTU to provide open access to Licensee or Generating Company on payment of transmission charge • Any consumer when open access is provided by State Commission on payment of surcharge in addition to transmission charges. • Surcharge shall be for meeting cross subsidy, and to be progressively reduced and eliminated. • Surcharge not payable in case of captive generation and Distribution Companies. • CTU can not engage in generation and trading

  12. Legal Framework Sections 39, 40 and 41 • Similar provisions for STU and Transmission Licensee. • STU can not engage in trading. • Transmission Licensee can not engage in trading Section 42 • State Commission to provide Open Access to all consumers who required supply more than 1 MW in 5 years.

  13. Agencies involved in Short-Term Open Access Transaction • RLDC (s) • SLDC (s) • CTU • STU (s) • Buyer • Seller • Trader

  14. Open Access – CERC Regulations, 2008

  15. Open Access Regulations, 2008 • Regulation notified dated 25.01.2008, (scheduling w.e.f. 01.04.2008 as per New Regulation) • Regulations , 2004 are now being repealed w.e.f 1st April,2008 • Procedure for Bilateral Transaction • POWERGRID/CTU -submitted on 28.01.2008 • CERC Approval on 31.01.2008 • Posting of Approved Procedure on RLDC websites – 31.01.2008 • New regulation also cater for transaction through Power Exchange (Px) • Procedure for Collective Transaction • POWERGRID/CTU -submitted on 12.02.2008 • Regulations cover only Short-term Open Access • Earlier Products of Short-Term retained under Bilateral Transactions

  16. Transactions categorized as Bilateral and Collective (through Px) • Nodal Agency • Bilateral : RLDCs • Collective : NLDC • Transmission Charges moved from “Contract Path” to “Point of Connection” • Both Buyers and Sellers of Collective transactions to bear transmission charges and absorb transmission losses • Inter-Regional links -No Separate treatment. • Emphasis on “Scheduling” rather than “Reservation” • SLDC consent mandated along with application • In case of Congestion – e-Bidding without Price Cap • Exit Option provided with payment of up to 5 days open access charges. • Moving towards empowerment of SLDCs

  17. Comparison of CERC Regulations on Short-Term Open Access (Regulation 2004, Amendment 2005 and Regulations 2008))

  18. Short-Term Open Access transactionby Captive Power PlantsA typical example:From : SAIL Durgapur Steel Plant (DVC), To : SAIL Bhilai Steel Plant (CSEB)Quantum : 20 MW Source : SAIL

  19. Network Involved

  20. Transmission Losses

  21. Transmission and System Operation Charges

  22. Procedure for Scheduling ofOpen Access (Bilateral Transaction)

  23. Outline • CERC Regulations on Open Access in inter-State Transmission, 2008 – Provisions 4, • Applicable for Scheduling of Open Access (Bilateral Transactions)– w.e.f. 01.04.2008

  24. SUBMISSION OF APPLICATION • Nodal Agency • RLDC where point of drawal is situated • Application Contents • Details -Buyer /Seller /Point of injection/point of drawal/Contracted power at supplier interface/date/time period • Application Fee (Rs. 5000/-) • Along with application • With in 3 working days ( for same day or next day transaction) • Endorsement • Concerned RLDCs/SLDCs

  25. CONCURRENCE OF GRID OPERATORS • Available Transfer Capability • SLDC – ( congestion in intra-State TS) • concurrence -along with Application • RLDC - ( congestion in Regional TS) • To be obtained by Nodal RLDCs • Refusals /Curtailed Concurrence • Reasons to be mentioned in writing

  26. ADVANCE SCHEDULING • Advance Scheduling – 3 months in advance • Separate Application – • Month wise - each transaction • Time Line for submission • Last date for submission ( -10 / -5 / 0 days prior to end of current month MO – for transaction in M1, M2, M3) • Cut-off time : 17:30 Hrs. of last day (Day 0) • Request for concurrence (RLDC) – by 12:00 Hr. next day (Day 1) • Concurrence - by 20:00 Hrs (Day 1) • Congestion Information to Applicant – next day 12:00 Hrs (Day 2) • Revised Request – next day 11:00 HRs. (Day3) • E-bidding – in case of Congestion (next day) (Day 4) • Acceptance/Refusal of Scheduling Request – (Day 5)

  27. Time Line for Advance Scheduling M1 M0 M2 M3 10 5 5 Processing time for RLDCs Last Day for submission of Applications for transactions in M1, M2, M3

  28. e-Bidding Procedure • Invitation of Bids • period of congestion • RTS/IR corridor – overstressed • Only Registered Users • User ID & Password • Electronic submission – website of CTU • Bid Closing time as specified • Single Price Bid • No Modification/withdrawal once submitted • Bid Price - in addition to Open Access Transmission Charges • Multiples of Rs. 10/ MWh . ( Min. Rs. 10/MWh) • Mandatory - Non-participation – Rejection of Application • Acceptance - Decreasing order of Price Quoted • Equal Price Bids – Pro-rata • Part Acceptance – Price as quoted by the bidder • Full Acceptance – Price quoted by last bidder getting full acceptance

  29. “FIRST-COME-FIRST-SERVED” BASIS • Scope • Current Month • Next Month ( during last 10 days of end of current month) • Separate Application for each month • To be submitted 4 days prior to date of Scheduling • Processing time – 3 days • Processed on FCFS basis • Application Received in a day to be processed together – same priority • Application Received after 17:30 Hrs. - next day • Congestion Management – pro-rata

  30. DAY-AHEAD BILATERAL TRANSACTION • Applications received within 3 days prior to the day of Scheduling and up to 15:00 Hrs. of the day immediately preceding the day of scheduling shall be treated as having been received together for processing and shall have same priority. • Processing only after processing of the Collective Transactions of the Power Exchange (s). • Congestion Management – Pro-rata

  31. SCHEDULING OF BILATERAL TRANSACTION IN A CONTINGENCY • Only Buying Utility to make an Application to the Nodal RLDC. • To be considered after 1500 hrs of the day immediately preceding the day of scheduling. • In case of intra- day – scheduling from 6th time block • Congestion Management – Pro-rata

  32. INCORPORATION IN DAILY SCHEDULES • RLDCs to incorporate in Daily Schedules of the Regional Entities • Average energy losses -estimated on weekly basis • RLDCs – ISTS • SLDC – intra-State TS • resolution of 0.01 MW at each State/inter-Regional boundaries. • ramp-up • at the time of commencement of the transaction • ramp-down • at the time of termination of the transaction

  33. REVISON OF SCHEDULE • Only in case of “Advance Scheduling” or “First-Cum-First Served basis” • minimum five (5) days notice • Transmission Charges and Operating Charges for 5 days • Margin Available – could be utilized for scheduling of other Open Access Transactions

  34. Example: • Say an Applicant has been scheduled for 10 days from 21st day of a month to 30th day of a month for 100 MW on round the clock basis (i.e. for 2400 MWh per day). If this Applicant, on or before 15th day of that month, submits request for revision of schedule to 50MW on round the clock basis (i.e. 1200 MWh per day), the revised schedule will get implemented from the beginning of the transactions (i.e. 21st day of the month). The Applicant shall pay the Transmission Charges for 2400 MWh per day for the period from 21st to 25th day of the month. Whereas for the period from 26th day to 30th day of the month, Transmission Charges shall be payable for 1200MWh per day. • However, if the Applicant requests for such revision on 17th day of the month, his request will be implemented from 23rd day of the month. He shall pay Transmission charges for 2400 MWh per day for 5 days i.e. from 23rd to 27th day of the month and for the remaining period he shall pay the Transmission Charges based on 1200MWh per day.

  35. CURTAILMENT IN CASE OF TRANSMISSION CONSTRAINTS • Allocation/Reallocation of ISGS power • Transmission constraint or to maintain grid security • curtailed in the manner, which in the opinion of RLDC, would relieve transmission constraints/ enhance grid security • Open Access Bilateral Transactions would generally be curtailed first followed by the Collective Transactions • Rerouting allowed without curtailment • Pro-rata refund of Transmission Charges

  36. COMMERCIAL CONDITIONS • All Payment related to Open Access Charges • by Applicant to the Nodal RLDC • within three working days from the date of acceptance • Application Fees (as per Para 7 of Regulation) • non-refundable fee of Rupees five thousand (Rs.5000/-) only • Transmission charges (Para 16 of Regulation) • Intra-region (Rs.30/MWh) • Adjacent Region (Rs. 60/MWh) • Wheeling (Rs.90/MWh) • STS charges – as specified by respective SERCs or Rs. 30/MWh • Operating charges (as per Para 17 of Regulation) • Rs. 2000/- per day each RLDCs/SLDCs involved

  37. DEFAULT IN PAYMENT OF OPEN ACCESS CHARGES • nodal RLDC, at its discretion • may not schedule the transaction or • may cancel the scheduling of already scheduled transaction or • may not entertain any Application of such Applicant in future until such time the default is cured. • simple interest at the rate of 0.04 % for each day of default from the Due Date of Payment • Cheque has been dishonored • No cheque payment - next three (3) months

  38. DISBURSAL OF PAYMENT • Reconcile the Open Access Charges • 10th day of the current month • Transmission Charges and Operating Charges – for State System • Concerned STUs/SLDCs • For ISTS • 25% to be retained by CTU • 75% to be utilized for reduction of Transmission charges of Long Term customers • Refund due to curtailment • 15th day of the current month

  39. GENERAL CONDITIONS • “One- Time” information as per enclosed format • Application - through Post/fax • Any amendment/modification • fresh Application • Applications not been accorded the Acceptance • stand disposed off with suitable intimation to the concerned Applicant(s) • incomplete/vague Application • summarily rejected • The Applicant shall abide by the provisions of The Electricity Act, 2003, Indian Electricity Grid Code and CERC Regulations, as amended from time to time • Applicant shall keep each of the SLDCs/ RLDCs indemnified

  40. Short-Term Open Access -Experience so far

  41. OPEN ACCESS IN INTER-STATE TRANSMISSION • Implemented w.e.f. 6-May-2004 • Products – • Long term Access • Short term Access • Monthly • Advance • First Come First Serve • Day ahead • Intra day transactions • Permits usage of spare transmission capacity through a transparent process • Offers choice and freedom to buy & sell power • Provides signals for investment.

  42. <--Introductionof Day-Ahead Product from May,2005