The Green Day-Ahead Market (GDAM) has revolutionized the renewable energy sector, providing fresh opportunities for power generators and distribution companies (DISCOMs) to trade surplus power on exchanges. Arcelor Mittal emerged as the leading energy procurer from GDAM during the fourth quarter of 2023.
Opportunities for Renewable Energy Generators and DISCOMs
GDAM has proven to be a game-changer for renewable energy generators and DISCOMs. The market allows power generators, often affected by long-delayed payments from DISCOMs or surplus power from projects linked to power purchase agreements (PPA), to sell their excess power on exchanges. This not only prevents wastage of power but also ensures immediate payments for the power sold on the same day it is delivered.
By reducing green power curtailment and creating a new market for untapped renewable energy potential, GDAM has facilitated the development of merchant renewable energy capacity without the need for long-term PPAs. Additionally, obligated entities like DISCOMs and captive power consumers can now efficiently manage their green energy requirements.
Top Sellers in GDAM for Q4 2023
According to the Mercom India Solar Open Access Market Report Q1 2024, Adani Hybrid Energy led the market as the top seller, accounting for 14.2% of the power sold through the exchanges. Adani Solar Energy followed with 8%, while Ostro Energy, ReNew, and Jammu & Kashmir accounted for 7.8%, 7.5%, and 6.3% respectively. The top five states represented 43.8% of the power sold in GDAM in Q4 2023.
Top Buyers in GDAM for Q4 2023
Arcelor Mittal was the dominant buyer in GDAM, securing 36.4% of the total market share. Delhi followed with 12%, and other major buyers included Tamil Nadu (9.7%), Bharat Aluminium (8.3%), and Damodar Valley Corporation (4.9%). The top ten states collectively made up 88% of the total energy procured through GDAM.
Volume vs. Price in GDAM
Q4 2023 saw significant trading activity in GDAM, with the highest trading volume observed in December. The highest weighted average price, however, was recorded in October. Throughout the quarter, trading volume increased by 14% quarter-over-quarter, while the highest weighted average price experienced a slight decline of 1.5%.
The Indian Energy Exchange (IEX) traded green energy in GDAM at a weighted average price of ₴6.37 ($0.0766)/kWh in October, ₴4.69 ($0.0564)/kWh in November, and ₴4.86 ($0.0584)/kWh in December.
Conclusion
GDAM’s introduction has brought about significant changes in the renewable energy landscape, benefiting both power generators and DISCOMs. With entities like Arcelor Mittal leading the procurement and companies like Adani Hybrid Energy spearheading sales, the market demonstrates the immense potential for growth and sustainability in the renewable energy sector.
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