Emergence of Open Access as an alternative source of power for Industries
The Electricity Act, 2003 had since its conception created the provision for implementation of Open Access across the country and thus promoting competition in electricity market. Provision of Open Access provides for in-discriminatory use of distribution and transmission facilities thus enabling power supplier/ consumer to choose its buyer/ seller other than the concerned distribution company of its area. Accordingly, Open Access for inter-state was introduced in May 2004 which streamlined the bilateral market for trading of power amongst states. Thereafter, Open Access 2008 regulation was introduced by Central Electricity Regulatory Commission (CERC) which essentially provided the methodology & procedure of Open Access under two categories of transactions namely Bilateral and Collective (implemented in power exchange). It provided the buyer/ seller primarily two kinds of transactions under Open Access, ‘Bilateral’ transactions for contracts upto 3 months and ‘Collective’ transactions for anonymous simultaneous competitive bidding on power exchange.
Online and automated platform for competitive bidding i.e. “Indian Energy Exchange” (first power exchange of India) was launched on 27th June, 2008 by PTC India Financial Services and Financial Technologies. This provided the Indian Power Market with an online and automated platform for power trading. It was followed by the launch of second power exchange “Power Exchange of India Limited” promoted by NSE and NCDEX. As power exchange was a new product for Indian power market, the inaugural participants on the exchange were the state electricity boards and IPPs. Power Exchanges catered to their immediate demand and availability through Day Ahead Market.
The Discoms have been so far resistant to give full Open Access to industries (1 MW and above) due to various reasons. We may owe some of these reasons for partial or non-implementation of...