Objective

The exchange would desire to meet the following objectives:

Short Term

• To set up adequate infrastructure for trading, clearing and settlement of electricity contracts for the Indian Power Sector participants: Traditional trading in most markets has been opaque and discriminatory with one set of participants reaping the benefits of information asymmetry. Modern day trading is totally transparent where all participants are on an equal footing. Electronic exchanges worldwide have provided the platform for traders to move on to such automated, reliable and fair markets. PXIL would be set up as a fully automated exchange with tried and tested clearing systems.
• To provide single window clearance for traded electricity contracts: The exchange would aim to simplify the trading procedure for the participants and ideally reduce the no. of interfaces for the participants to only one i.e. the exchange.
• To provide a market for the distribution entities for meeting top-up demand: The exchange would aim to provide a reliable marketplace for buyers to meet up with any additional demand they have over and above the demand that is being met presently through long term PPAs.
  
  

Medium Term

Augment the Government objectives of reducing peaking power deficit

• The Exchange will provide equitable market place for the new merchant capacities (including hydro, IPPs co-generation, renewable, etc.)
• The Exchange will try to augment existing capacities by providing an easy-to-access market for untapped sources (e.g. Captives)
  

Long Term

• The Exchange would seek to provide transparent and fair price discovery mechanism which can signal massive potential investments into the sector, especially in the transmission sector, because the prices would clearly identify the corridors where investments are needed the most.
• Be a catalyst for the Power Sector – to move from scarcity-based pricing to a competition-based pricing structure.