Damodar Valley Corp Auction Sees Prices Align With NSE Electricity Futures
The alignment of auction prices with the NSE electricity futures indicates that the exchange-traded contracts are increasingly being used as a benchmark for the physical term-ahead market.
The Damodar Valley Corp. concluded its auction for buy bids of 50 million units of round-the-clock power from Nov. 5–30 in alignment with the NSE electricity futures, according to people aware of the matter.
The price discovered in the auction was Rs 3,231 per megawatt per hour, which is nearly identical to the November 2025 NSE Electricity Futures contract price. NTPC Vidyut Vyapar Nigam Ltd and SKS Power Generation Ltd were the suppliers in this auction.
Market observers said the alignment of auction prices with the NSE electricity futures indicates that the exchange-traded contracts are increasingly being used as a benchmark for physical term-ahead market.
Market experts said that this close alignment between the physical market auction price and the exchange-traded futures contract indicates that participants are beginning to use NSE's electricity futures as a reference benchmark for physical TAM deals, a sign of growing maturity in India’s power trading ecosystem.
They added that this as a positive trend that enhances transparency and price discovery in the electricity market, helping buyers and sellers align physical contracts with market expectations reflected in exchange-based futures.
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Electricity futures contracts are traded from Monday to Friday between 9 am and 11:30 or 11:55 pm, depending on the daylight-saving-time adjustments. Contracts are cash-settled and benchmarked to the market price published by the Power Exchange of India Ltd.
Position limits have been capped at 30 lakh megawatt-hours for trading members and 3 lakh MWh for individual clients. The contracts require a minimum margin of 10 per cent or as determined by SPAN rules, and price movements will be subject to SEBI-mandated daily limits of 6 per cent.
To qualify, interested trading members must meet certain criteria. This includes a net worth of at least Rs 5 crore, SEBI registration in the commodities segment, and relevant experience in the electricity value chain, such as power generation, trading or infrastructure.
They must also maintain minimum trading activity, with continuous buy and sell quotes during most of the trading hours.
