In the fiscal year 2025, the Indian Energy Exchange (IEX) witnessed an unprecedented surge in electricity trading, driven by a significant rise in power demand across the nation. The exchange reported a staggering 19% increase year-on-year, amounting to 121 billion units (BU) of electricity traded. This spike in consumption, which rose by 4.4%, reflects the growing energy needs of India’s expanding economy.

Record Monthly Trading Volumes

The month of March alone set new records, with trading volumes soaring to 11,215 million units (MU), marking a remarkable 29% increase compared to the same month last year. The rise in temperature and heightened commercial activity contributed to this surge, as businesses sought to finalize orders before the fiscal year concluded.

• March 2025 Energy Consumption: India’s total energy usage reached 148 billion units, a 7% rise from the previous year.
• Peak Demand: On March 11, 2025, peak power demand hit 235 GW, exceeding the previous year’s record of 222 GW.

Competitive Market Pricing

Despite the growing demand for electricity, the average market clearing price in the Day Ahead Market (DAM) during March was ₹4.47 per unit, thanks to increased supply. The DAM serves as a physical marketplace where participants can buy and sell electricity for the following day, ensuring a competitive pricing environment.

Government Initiatives for Enhanced Supply

To support the escalating demand, the Ministry of Power implemented several measures throughout the fiscal year. These strategies included:

• Full-capacity operation directives for imported coal-based power plants.
• Sale of surplus power on exchanges.
• Ensuring availability of gas-based plants.
• Increased operational readiness of generating units.

With a comfortable coal inventory lasting around 21 days and no generation losses reported, these initiatives helped maintain liquidity in the power supply system.

Renewable Energy Certificates on the Rise

As peak electricity needs reached a record 250 GW on May 31, 2025, projections indicate that demand may escalate to 270 GW in the upcoming summer months. This trend hints at continued robust trading activity on the exchanges.

During FY25, the IEX also saw a remarkable 136% year-on-year increase in the trading of renewable energy certificates (RECs), totaling 178 lakh certificates. Each REC represents one megawatt-hour (MWh) of electricity generated from renewable sources such as solar, wind, or hydro.

• March 2025 REC Trading: The exchange recorded the trading of 13 lakh RECs, an 18% increase from the previous year.

Importance of RECs in Renewable Energy Development

RECs play a crucial role in promoting the renewable energy market, enabling organizations to offset their carbon emissions by purchasing certificates, even if they do not generate renewable energy directly. The escalating demand for electricity and the corresponding growth in REC trading underscore the importance of sustainable practices in meeting India’s energy needs.

As India braces for a potential 9-10% surge in power demand in 2025 due to rising temperatures, the focus on renewable energy and efficient trading practices will remain paramount for the country’s energy landscape.