The National Stock Exchange (NSE) is expected to launch monthly Electricity in cash according to the manager of the largest Indian stock exchange.
The date of the launch of the monthly electricity contract will be announced in the next two to three weeks, said Harish Ahuja, head of sustainability, energy/carbon, market, list on the NSE on Wednesday.
NSE received approval from the regulatory body of the 11th June market for the purpose of starting electricity derivatives. These financial contracts help energy companies and other electricity buyers protect against sudden changes in prices.
The monthly contract will be available for all 12 months of the year, Ahuja said in a media round table. It starts the first working day of each month and expires the day before the termination of the contract.
The size of the batch of the single -month Futures agreement will be 50 MWh, which corresponds to 50,000 units of electricity in one contract. The contract is broadcast for cash, which means that if the spot price increases above the futures price, the buyer gets the difference.
The price will be decided by receiving a 30-day weighted average spot price of three energy exchanges-Indian Energy Exchange Ltd, Hindustan Power Exchange LTD and HPL Electric and Power Ltd.
Participants could be energy generators, distributors, traders, individuals with high net value and retail participants such as centers, hotels and corporations.
Ahuja said that the Electric Futures Treaty would eventually not become a speculative place, such as derivative tools for its own capital, because globally the power market is approximately three times on the market. In the case of shares, derivatives are almost 100 times the money market size.
After a monthly futures contract for electricity, NSE also plans to set up quarterly and annual contracts.
Electricity futures can help discom to provide electricity prices during high demand, such as the summer or festival periods. It can help generators to ensure the trader’s income and allow traders to hold speculative or secured positions.
India is the third largest energy producer in the world, with 1,900 billion units generated in 2025. “With regard to global derivatives and generational standards of their respective countries, India has a potential derivative market size of approximately 8,000 billion units,” said the NSE presentation.
(Tagstotranslate) Indian Energy Exchange Ltd (T) NSE (T) Hindustan Power Exchange Ltd (T) HPL Electric and Power Ltd (T) Energy Generators (T) Distributors (T) Regulator
