New Delhi
The National Stock Exchange (NSE) will launch monthly electricity futures contracts within the next two to three weeks, offering a new tool for managing price risks in the power sector. This product will benefit power buyers, sellers, traders, and industries by allowing them to plan better in a price-sensitive market.
Harish K Ahuja, NSE’s head of sustainability and power markets, confirmed that all regulatory approvals are in place and the internal team is ready. The contract will begin on the first business day of each month and expire just before the month ends.
To encourage early participation, NSE will waive trading fees on electricity futures for the first six months, announced Chief Business Development Officer Sriram Krishnan.
Each contract will represent 50 MWh—equal to 50,000 units of electricity. Prices will be based on a 30-day weighted average from three exchanges: Indian Energy Exchange Ltd, Hindustan Power Exchange Ltd, and HPL Electric and Power Ltd. Tick size is set at Re 1 per MWh, with a maximum order size of 2,500 MWh.
NSE is also exploring contracts for difference (CfD), helping renewable energy projects gain steady income—a move crucial for India’s clean energy goals.
According to NITI Aayog, India needs over $250 billion annually until 2047 to meet its net-zero targets. With solar and wind expected to make up more than 50% of power capacity by 2030, such futures contracts will support much-needed investments.
NSE, which launched Power Exchange India Ltd in 2008, now aims to build a liquid electricity derivatives market, combining its expertise in both spot and futures trading.
