Author: PPD Team Date: 04/07/2025
The Multi Commodity Exchange of India (MCX) will introduce monthly electricity futures contracts starting July 10, 2025. These contracts are designed to help market participants manage electricity price risks with better precision.
The new instrument is called the “Electricity Futures (Monthly Base Load) Contract.” It will be cash-settled and traded in Rs per megawatt-hour (MWh). Each contract will cover 50 MWh and be available for all 12 months of the year, with up to four contracts open for trading at a time.
Trading will occur from Monday to Friday, between 9:00 a.m. and 11:30 p.m. (or 11:55 p.m. during U.S. daylight saving time). Each contract will close on the business day before the last calendar day of its expiry month, ending at 12 p.m. on that day.
The price will be settled based on the Unconstrained Market Clearing Price (UMCP) from the Day Ahead Market (DAM) of the Indian Energy Exchange (IEX). Final settlement will use the volume-weighted average of UMCP across all days in the expiry month.
Margins will follow the SPAN system or require a minimum of 10%, whichever is higher. Additional or special margins may apply during volatile periods. Daily price limits are capped at 9%, with an initial slab of 6% and a 3% enhanced slab after a 15-minute cooling-off period.
The maximum open position for a client will be 3 lakh MWh or 5% of the market-wide open position, whichever is higher. For members, the cap is 30 lakh MWh or 20%.
The first contract, for August 2025 delivery, will expire on August 29. September and October contracts are scheduled to expire on September 29 and October 30, respectively.