The Central Electricity Regulatory Commission (CERC) has amended its earlier order dated February 6, 2023, relating to the CERC (Deviation Settlement Mechanism and Related Matters) Regulations, 2022.
The introduction of high price-day ahead market (HP-DAM) and the revision in the price ceiling in various market segments in power exchanges, makes it expedient to align the normal rate of charge for deviation with that of HP-DAM. This is considered necessary to avoid any possibility of arbitrage between HP-DAM and deviation settlement mechanism (DSM). Accordingly, the commission has set a normal rate of charges for deviation for a given time block, which will be determined as the higher of the weighted average area clearing price (ACP) of the day ahead market (DAM) segments of all power exchanges for that time block, or the weighted average ACP of the real-time market (RTM) segments of all power exchanges for that time block. For a seller whose bid is cleared in the HP-DAM, the normal rate of charges for deviation by way of under-injection for a time block will be equal to the highest of the weighted average ACP of the HP-DAM market segments of all the power exchanges; or the weighted average ACP of the DAM segments of all the power exchanges; or the weighted average ACP of the RTM segments of all the power exchanges, for that time block for the quantum of power sold though HPDAM. The direction has come into effect from April 10, 2023.
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