Industry chamber Federation of Indiana Chambers of Commerce and Industry (FICCI) today pitched for creation of a completely new market design in the power sector apart from linking the upcoming natural gas trading hub with spot power market as a solution for resolving the stressed assets in the electricity sector.
“Holistic solutions to address the systemic issues will involve creating a new market design that will allow capacities, including the stranded ones, to be matched with demand projections via tradable instruments and risk management tools,” FICCI President Rashesh Shah said.
Stressed coal-based power generating assets, especially those of Independent Power Producers (IPPs), will need a differentiated resolution path primarily because the crisis is caused more by externalities beyond the control of sponsors, according to the industry body.
“A related approach would be to converge the proposed gas trading hub with power market operations to set up gas short-term trades and spot purchases and enable gas-based power plants, which are also stranded, to serve peak and balancing loads and also provide supply on demand,” Shah said. Read More