Power prices in spot markets decline by almost 40% in North India

KOLKATA: Power prices in the spot markets have started to decline. It has dipped by almost 40% over the last eight days in northern India and is likely to fall further as the mercury rises.

"Gradual rising of mercury has resulted in falling demand for power in almost all regions of India, especially north which was under the grip of sever winter chill. This has resulted in lower demand for power in the spot markets and falling prices," Rajesh K Mediratta, Sr VP-Business Development at IEX told ET.

"Another reason for fall in demand is higher generation from hydel power plants which is witnessing a rise in reservoir levels due to melting snow in mountains. Higher reservoir levels result in increased generation as the water flow speed increases allowing the turbines to rotate faster," he said.

Power price for north India at the Indian Energy Exchange was about 4 per unit eight days ago. This has declined to 2.5 per unit now.

Similarly, in western India, prices dipped from a high of 3.4 per unit a week back to 2.2 per unit now - a 35% fall. In the east, prices declined 16% to 2.5 per unit from 3 seven days back.