IEX shares fall 8 percent as CERC revives market coupling proposal

Last Updated:April 20, 2026, 1:47 PM IST

IEX shares fall nearly 8 percent after CERC issues fresh draft on market coupling, raising uncertainty over reforms that could erode IEXs dominant power trading position

News18

IEX Shares Fall After CERC Revisits Market Coupling Framework: Shares of Indian Energy Exchange (IEX) declined nearly 8% on April 20 after the Central Electricity Regulatory Commission (CERC) released a fresh draft notification on power market norms, reopening discussions on market coupling for public comments.

The move has once again brought into focus a structural reform that could significantly alter India’s electricity trading landscape. Market participants reacted cautiously, given the potential implications for IEX, which currently dominates the segment.

Market Coupling Back In Focus

Market coupling refers to a mechanism where electricity prices across multiple exchanges are unified into a single market-clearing price. Instead of independent price discovery on each platform, bids from all exchanges are pooled and processed centrally.

CERC had earlier proposed implementing market coupling starting January 2026 under the Power Market Regulations, 2021. Following that announcement in 2025, IEX shares had plunged nearly 30% in a single session, reflecting investor concerns over its future market share.

Under the proposed framework, Grid-India would act as the central entity responsible for aggregating bids and determining a uniform price, particularly in the day-ahead market (DAM).

Impact On IEX’s Dominance

Currently, electricity trading in India is split across three platforms: IEX, Power Exchange of India (PXIL), and Hindustan Power Exchange (HPX). IEX commands around 85% market share, with strong dominance in both the day-ahead market (DAM) and real-time market (RTM).

At present, each exchange independently matches bids and determines prices, giving IEX a competitive edge due to its higher liquidity and participation levels.

However, market coupling would eliminate this advantage. Exchanges would only serve as bid collection platforms, while pricing would be centrally determined. This shift reduces the incentive for traders to prefer one exchange over another, potentially eroding IEX’s leadership position.

Efficiency Gains Versus Competitive Risks

CERC has argued that market coupling would improve overall market efficiency, ensure optimal resource allocation, and boost confidence among participants through transparent and uniform pricing.

While these benefits may strengthen the broader power market, analysts note that the reform could compress trading volumes and margins for dominant players like IEX.

The reintroduction of draft norms suggests that the regulator is continuing stakeholder consultations before final implementation, keeping uncertainty alive for exchange operators and investors alike.

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