India's exchange to launch electricity futures contract

Multi Commodity Exchange of India (MCX), the leading commodity derivatives exchange in India, will launch electricity futures contracts effective July 10, 2025. This launch follows SEBI's approval and aims to address the growing need for price stability in the electricity sector. The contract will be available for all 12 calendar months, initially open for the current and next three months. The trading unit is 50 MWh, quoted in INR per MWh, with a tick size of 1 per MWh. The contract will be cash-settled based on the Volume Weighted Average of the Unconstrained Market Clearing Price (UMCP) of the Day Ahead Market (DAM) at the Indian Energy Exchange (IEX). The contract follows SEBI's Daily Price Limits (DPL) for market stability. Client level position limits are capped at 3 lakh MWh or 5% of the market-wide open interest whichever is higher. According to MCX, the electricity futures are an innovative step toward a deeper energy market and support sustainable, market-driven power pricing.