NSE Set to Launch Electricity Futures Contract to Boost India's Clean Energy Targets

The National Stock Exchange (NSE) is poised to unveil its electricity futures contract, aiming to provide a vital tool for power buyers, sellers, and traders to hedge against price volatility. This new financial instrument is expected to debut in the next two to three weeks, according to Harish K Ahuja, NSE's head of sustainability, power, carbon markets, and listing.

The monthly contract, designed to commence on the first business day and conclude just before the month's end, has received all necessary approvals. NSE's Chief Business Development Officer, Sriram Krishnan, emphasized the exchange's commitment to boosting early adoption by offering a six-month waiver on transaction charges for trading these contracts.

As India strives to achieve its net-zero emissions target by 2047, estimated to require an investment of over USD 250 billion annually, the launch of electricity futures contracts is seen as pivotal. By 2030, renewable energy is projected to contribute significantly to India's power capacity, making the development of a sophisticated electricity derivatives market crucial for securing climate finance.

(With inputs from agencies.)