Energetica India Magazine - November 2025

transmission infrastructure appears mis- placed. The current approach of allocat- ing transmission corridors amongst the power exchanges on a pro-rata basis by the system operator does not leave any further scope for improving the utilisa- tion of transmission corridors for the exchange market. This is because the ex- changes do not have enough market im- pact to cause any significant ‘congestion’ on Inter-state lines that coupling could relieve. • Deployment of SCED along with Mar- ket Coupling: A Novel Concept: Unlike market coupling, which has previously been successful in Europe, integrating the SCED model with market coupling is a novel concept with no prior data to support its long-term viability. The CERC has duly acknowledged that this is a novel experiment and therefore de- cided to implement the proposed model in a shadow pilot. However, implementa- tion might require continued regulatory intervention and oversight. While the above-mentioned roadblocks must be addressed, the potential bene- fits of market coupling cannot be over- looked, including: • Increased Economic Surplus: In the case of coupled collective transactions on the power exchange, Market Clear- ing Price (MCP) discovered through the matching of aggregate buy and sell bids would result in creation of a surplus for the buyers and sellers of electricity, the summation of which is referred to as the ‘economic surplus’. This surplus is calculated as the difference between the accepted bid price and the clearing price per unit of electricity, multiplied by the total cleared volume. • Discovery of a Uniform MCP: Apart from enhancing economic surplus for market participants, it may also include other benefits. Pertinently, since De - viation Settlement Mechanism (DSM) charges are currently indexed to the clearing price of DAM, a single price from market coupling would minimise the scope for any arbitrage between de- viation settlement and the market. • Improved Liquidity and Prices: In the coupled scenario, when sell and buy bids from all the exchanges are merged, there is a greater possibility that more volumes would be cleared, creating more liquidi- ty in the market. Additionally, merging bids and offers would also lead to price efficiency, and, therefore, MCP may be discovered at the lower end. CERC’s Order dated July 23, 2025, also directs that: • Grid-India shall share the operational experience of running the shadow pilot with the CERC. • The three power exchanges shall share the necessary data and other information as required by the staff of the CERC and Grid-India for necessary analysis. Although the CERC has set a deadline of January 2026 for the coupling of DAM, however, the enabling regulatory amend- ments are yet to be notified. Until these are in place, the entire scope of poten- tial impediments or the incentives for stakeholders cannot be fully ascertained. Success of the phased implementation will depend on timely regulatory action, stakeholder cooperation, and effective resolution of issues identified during the shadow pilots. Notably, IEX has filed Appeal No. 298 of 2025 titled ‘Indian Energy Exchange v. CERC’ before the Appellate Tribunal for Electricity (APTEL), challenging the order dated 23.07.2025. APTEL, by its order dated September 9, 2025, has ad- mitted the appeal filed by IEX and is - sued notice to the respondents. While there is still no stay on order dated July 23, 2025, yet, any decision by AP- TEL could significantly shape the trajec - tory of market coupling in India’s power sector and determine whether the exper- iment evolves into a structural reform or remains a regulatory curiosity. energetica INDIA- November_2025 57 MARKET COUPLING