IEX’s plea against power exchange market coupling rejected by SC
The Supreme Court has declined to intervene in the ongoing dispute over market coupling in India’s power exchanges, allowing the Central Electricity Regulatory Commission (CERC) to continue framing the proposed regulations while making it clear that it has not expressed any view on the merits of the issue.
The order, passed on August 3, 2026, comes as a setback for Indian Energy Exchange (IEX), which had approached the apex court seeking either a stay on CERC’s regulation-making process or a complete halt to it.
The bench observed that it was “not the appropriate stage to hear the matter” and permitted the regulatory process to continue. It also noted that the regulations have not yet been finalised and that IEX would be free to challenge them after they are notified.
During the hearing, the Court observed that the power exchange segment “appeared to be an unorganised space” and was “in need of regulation.”
IEX arguments
Opposing the proposed market coupling framework, IEX argued that it would undermine competition by effectively pooling prices across different power exchanges.
The company described the proposal as a form of “nationalisation” and “socialism”, contending that its commercial success “can’t be nationalised.” It questioned whether exchanges operating with different market dynamics could be brought under a common price discovery mechanism, drawing a comparison with the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE).
To illustrate its argument, IEX compared the proposal to requiring shoppers visiting Delhi’s popular Khan Market to purchase goods available in RK Puram Market, arguing that differences in market popularity do not justify forced coupling.
The company also maintained that there was no monopoly or duopoly in the power exchange market, arguing that competition already exists among exchanges.
IEX further referred to a Securities and Exchange Board of India (SEBI) report that it said identified instances of illegal trading involving CERC officials who are part of the team preparing the market coupling regulations. The company argued that this raised concerns over a potential conflict of interest in the regulation-drafting process.
Court’s view
The Supreme Court declined to examine these issues at the present stage, holding that judicial intervention was premature while the regulations remain under preparation.
The Court clarified that CERC may proceed with framing the market coupling regulations and that affected parties would have the opportunity to challenge the final regulations after they are notified.
