Power Ministry Seeks Market Coupling For Electricity Exchanges For Price Uniformity

In a bid to achieve price uniformity across multiple electricity exchanges in India, the power ministry has officially requested the Central Electricity Regulatory Commission (CERC) to initiate the market coupling process. This decision follows numerous appeals from stakeholders who believe that coupling could create a more streamlined and consistent pricing structure.

Currently, India operates three power exchanges, namely India Energy Exchange (IEX), Hindustan Power Exchange (HPX), and Power Exchange India (PXI). However, IEX dominates the market, accounting for an overwhelming 99.9 per cent of the total volume traded on the exchanges.

While the existing market share may not warrant immediate differences, according to media reports, the implementation of market coupling presents an opportunity for other exchanges to gain traction in day-ahead and real-time trading. By bringing together bids from all power exchanges and consolidating them through a market coupling operator, a single combined solution can be created, facilitating a more efficient and equitable marketplace.

The power ministry's decision to move forward with the market coupling process underscores the government's commitment to promote competition and foster a level playing field in the electricity sector.

The Central Electricity Regulatory Commission will now review the ministry's request and assess the feasibility and potential benefits of market coupling. If approved, this step could mark a significant milestone in the Indian power sector, potentially revolutionising the trading landscape and allowing for greater market participation by diverse stakeholders.