CERC issues draft power market regulations

The Central Electricity Regulatory Commission (CERC) has notified the draft Power Market Regulations, 2020. The regulations will apply to power exchanges, the over-the-counter (OTC) market, and other market participants as well as applicable for all contracts traded in the exchanges, renewable energy certificates, energy saving certificates as well as contracts in the OTC market.

Among other things, the draft regulations provide for a new concept called ‘market coupling’, which is a process of collecting bids from all power exchanges and matching them to discover a uniform market clearing price through an agency called a market coupling operator’ notified by the regulator. The regulations come in the backdrop of the power ministry’s order 10 days ago allowing electricity to be traded as other commodities with forward contracts and derivatives on exchanges. The last date for furnishing comments to the draft regulations in August 7, 2020.