Draft Indian Power Market (First Amendment) Regulations, 2025

Few days back, Central Electricity Regulatory Commission of India published the draft Power Market (First Amendment) Regulations, 2025. The amendment addresses important aspects which will help increasing the depth of Indian Power market, making it more dynamic, flexible and no doubt smarter !!

Key changes are:
1. Introduction of Virtual Power Purchase Agreements (VPPA)
** a strategic step to future-proof the Indian power market.
It will promote market-based revenue for RE generators and financial hedging for consumers.

2. Expansion of scope of OTC (Over-the-Counter) Market scope
OTC Market will now include:
+ VPPA contracts
+ Battery Energy Storage System (BESS) contracts
+ Banking of Power
This broadens the range of market instruments available to participants and enhances the scope for innovation.

3. Strengthening OTC Platforms' Regulatory Framework
* Platforms will not take counter-party or credit risk and will act as facilitators, not intermediaries.
* Minimum Net Worth for OTC platform operators raised to Rs. 35 crore (earlier it was Rs. 1 crore).
* Registration validity of OTC platform extended to 10 years (earlier it was 5 years).
This is expected to enhance market integrity and reduce systemic risks.

4. Shifting from Open Access to Connectivity and GNA Framework
* Open Access Regulations are replaced with Connectivity and General Network Access (GNA) Regulations, 2022
* Thus, the market will be aligned with the latest transmission access framework, improving consistency and clarity.

Overall, the draft amendment is designed to modernize Indian power market,
promote new market products, and strengthen oversight and compliance. However, its success will hinge on effective implementation, stakeholder engagement and regulatory responsiveness to emerging challenges.