On 15th June 2020, Minister of Petroleum and Natural Gas & Steel Shri Dharmendra Pradhan launched the Indian Gas Exchange (IGX), first nationwide online delivery-based gas trading platform. The exchange is expected to facilitate transparent price discovery in natural gas, and facilitate the growth of the share of natural gas in India’s energy basket.
What is Indian Gas Exchange (IGX) ?
Indian Gas Exchange (IGX) is a delivery-based trading platform for delivery of natural Gas and will enable market participants to trade in standardised gas contracts.
The platform has been incorporated as a wholly owned subsidiary of the Indian Energy Exchange (IEX) – India’s energy market platform and is fully automated with web-based interface to provide seamless trading experience to the customers.
Imported Liquified Natural Gas (LNG) will be regassified and sold to buyers through the exchange, removing the requirement for buyers and sellers to find each other.
However, as the price of domestically produced natural gas is decided by the government. It will not be sold on the gas exchange.
How will IGX work ?
India’s first automated national level Gas Trading Platform commenced its operations from 15th June 2020 for its Members to trade. This will enable efficient and competitive discovery of Gas Prices in spot contracts at designated physical hubs.
Trading Hubs for Delivery: –
- Dahej Hub- PLL Dahej Delivery Point (Petronet LNG Terminal)
- Hazira Hub- Mora Delivery Point (Hazira LNG Terminal)
- Oduru Hub-Interconnection of GAIL’s KG Basin Network and PIL Network
Member can place the sell and buy orders for their registered Clients through Web based Trader Workstation (TWS), allocated to them.
Benefits of Indian Gas Exchange (IGX)
The exchange will help bring down the price of natural gas through competitive trade, boosting usage in the country that relies heavily on cheaper coal for its energy needs.
LNG imports are set to become a larger proportion of domestic gas consumption as India moves to increase the proportion of natural gas in the energy basket from 6.2% in 2018 to 15% by 2030.
Other Important NEWS
Earlier on June 1, 2020 both the Indian Energy Exchange (IEX) and the Power Exchange India Limited (PXIL) have started their real-time market (RTM) trading platforms for buying & selling electricity units.
The real-time market (RTM) is a platform widely used across the world. In India, RTM is an endeavour by the Central Electricity Regulatory Commission (CERC) with an intent to make the power market dynamic by enabling trade in electricity through half-hourly auctions.
The RTM is designed as a half-hourly market, comprising 48 auction sessions of 15-minute duration each. The auction sessions would be conducted during even time blocks of the hour with delivery to commence from one hour after the closure of the trade session. Hence, the real-time market would ensure that buyers and sellers can purchase or sell electricity from anywhere across the country with just one hour’s prior notice.