Hi Abhinav
You have done some detailed worked.
One needs to step back and first analyze the electricity “market-design”
Short-Term power = contract with duration less than 1 year.
DSM (Deviation Settlement Mechanism) is not a “market” - it is used as “balancing power”. Eg. DISCOM predicts demand will be 1000 MW tomo. It buys 1000 MW power from various sources (long-term PPA, DEEP, IEX etc.). Now, suddenly there are torrential rains tomo, demand reduces to 900 MW. What happens to the extra 100 MW?
It gets sold in DSM.
The opposite is also true. If demand for some reason is actually 1050 MW instead of 1000 MW, the extra power is supplied via the “deviation settlement mechanism” (DSM).
The DSM rate is a penalty not a market price of electricity.
Higher volumes of DSM pose a security threat to the electricity grid.
This is the reason why we observe steady decline in DSM volumes over the years since CERC discourages these volumes by charging progressively higher penalty.
DEEP portal is only for price discovery not for settlement (ie transmission allocation)
IEX = price discovery + (guarantee of) delivery.
The drawback of IEX is that one can trade power only 11 days in advance since “forward contracts” in electricity are sub-judice.
This is also the reason why prices on IEX (day-ahead) are typically lower than DEEP portals, since sellers are desperate to sell (electricity cannot be stored). DEEP portal is a few months in advance, there is still time for the seller to make a contract at a higher price than selling that electricity in the day-ahead IEX market.
DEEP portal exists because they can do longer duration contracts.Once forward contracts are allowed on exchanges, DEEP portal may become irrelevant.
DEEP portal was introduced because power trading was completely OTC (negotiated settlement) before. There was huge scope for manipulation and/or corruption. Prices discovered for procurement in Maharashtra would be very different than prices discovered for procurement in Uttar Padesh (the famous UP tax).
I have sold electricity for 4 years myself.
My suggestion is first study a little more on market-structure before putting in too much effort on analyzing the numbers and relative prices and volumes.