LUCKNOW: A recent audit report submitted on May 30 has brought to light significant discrepancies in the power trading operations of the Uttar Pradesh Power Corporation Limited (UPPCL) on the Indian Energy Exchange (IEX). The report highlights a stark difference between the average purchase and sale prices of electricity during the fiscal year 2025-26, urging improvements in power scheduling to mitigate avoidable costs.
Audit Findings on Power Purchase and Sale
According to the audit, UPPCL purchased 1,619.56 million units (MUs) of electricity through the exchange at an average price of Rs 6.52 per unit. In contrast, it sold 6,060.29 MUs at an average price of Rs 3.77 per unit. The auditors also noted instances where power was both bought and sold on the same day, raising concerns about operational efficiency.
The report described the average sale price as "abnormally lower" than the average purchase price, recommending that UPPCL make greater efforts in scheduling power procurement and sale to avoid unnecessary increases in power costs. The audit, commissioned by UPPCL itself, did not quantify the financial impact but flagged the issue as a key area requiring closer attention.
UPPCL's Response and Market Dynamics
Responding to the observations, UPPCL Director (Corporate Planning) Deepak Raizada explained that the figures reflect the inherent functioning of electricity markets rather than any trading anomaly. He noted that electricity prices on power exchanges fluctuate widely throughout the day based on demand and supply conditions.
Raizada elaborated that daytime prices are often low due to abundant solar power generation, typically ranging between Rs 2 and Rs 3 per unit. Conversely, prices during evening peak hours can surge to Rs 8-10 per unit as demand spikes and solar generation declines. UPPCL generally sells surplus power during low-demand periods and purchases power later to meet peak consumption, which explains the price disparity.
He emphasized that short-term purchases are usually more expensive because they occur during high-demand periods. Comparing annual average purchase and sale prices without considering the timing of transactions may not fully capture the operational realities of power system management, he added.
Consumer Body Seeks Reforms
The audit observations have also drawn a response from the Uttar Pradesh Rajya Vidyut Upbhokta Parishad (UPRVUP), a consumer body. UPRVUP chairman Avadhesh Kumar Verma has written to Union Power Minister Manohar Lal Khattar, seeking a review of power exchange transactions and reforms in electricity trading. The body has called for greater scrutiny of exchange operations, particularly instances where power was bought and sold on the same day, and measures to ensure consumers are protected from avoidable costs arising from procurement decisions.
Verma stressed the need for transparency in exchange transactions and reforms to safeguard consumer interests. The consumer body's intervention underscores the broader implications of the audit findings for electricity consumers in Uttar Pradesh.
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