The Hindu Business Line : CERC issues norms for power exchange

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New Delhi Feb. 7 The Central Electricity Regulatory Commission (CERC) on Wednesday issued guidelines for grant of permission to operators wanting to set up and operate a power exchange in the country. Without stipulating a cap on the number of exchanges that can be set up by prospective players, the regulator has broadly prescribed the need for a clear ring-fencing between ownership, management and participation in the proposed exchange and the requirement for an efficient financial settlement and guarantee system.

"The Commission seeks to encourage the power exchange to emerge as a market-based institution for providing price-discovery and price risk management to the generators, distribution licensees, traders, consumers and other stakeholder," CERC Chairman, Mr A. K. Basu said.

He said that the promoters would be required to develop their own power exchange model and seek permission from the Commission before the start of the operation. "About four players have already intimated us on their plans (for setting up an exchange). We expect at least one exchange to be up and running by the end of the year," Mr Basu said.

While the promoter would have the freedom to develop, manage and operate the exchange in accordance to the rules and procedures, the Commission will look at aspects such as prevention of speculation, collusion and unfair gaming and adjudication of disputes between the exchange and the members, he said.

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