India’s renewable energy industry is rapidly transforming, with solar projected to meet nearly half of the global electricity demand growth by 2025’s end.
The Indian Energy Exchange (IEX), the country’s premier electricity trading platform, reported a 26% year-on-year surge in traded volumes in April 2025.
It reached 10,584 million units, while the green market’s traded volume nearly doubled to 782 million units.
India’s energy trading landscape is evolving to ensure efficient, transparent, and sustainable power distribution. Let’s understand more about what power trading is in the renewable energy of India.
Understanding Energy Trading
Energy trading refers to the commercial buying and selling of electricity and related commodities. This primarily works through power exchanges, bilateral agreements, and open access markets.
Energy trading exchanges such as the Indian Energy Exchange (IEX) and Power Exchange India Limited (PXIL) enable over 6,600 participants from across 29 states and 5 Union Territories to trade electricity in real-time.
They also facilitate Renewable Energy Certificates (RECs) and Energy Saving Certificates to support green goals efficiently.
This ecosystem ensures a transparent, competitive, and efficient energy supply for businesses and industries.
● The Fundamental Purpose of Energy Trading
Power trading plays a vital role in ensuring a reliable, efficient, and sustainable energy system. Here is why it is important:
- Efficient Energy Distribution: It enables real-time redirection of electricity to areas with high demand, helping prevent outages and ensuring a stable supply, especially during industrial surges or extreme weather.
- Renewable Integration: Power trading supports the integration of intermittent renewable sources like solar and wind by smoothing out fluctuations, making the transition to clean energy more practical and scalable.
- Optimised Resource Use: By transferring surplus power from low-demand to high-demand areas, power trading reduces waste and lowers costs for both producers and consumers.
- Market Stability: It balances supply and demand, helping stabilise electricity prices and create a predictable market, encouraging investment and long-term planning.
For businesses and industries, power trading offers a cost-effective way to manage energy needs with high reliability.
For policymakers, it is a strategic tool to promote sustainable energy access and a greener grid.
● Different Types of Energy Markets in India
Here is a breakdown of two major types of energy markets:
Spot markets facilitate short-term electricity trading, typically for same-day or next-day delivery. Prices in these markets are highly dynamic, responding in real time to fluctuations in demand and supply.
Key platforms include:
- Day Ahead Market (DAM): Buyers and sellers trade electricity for delivery on the following day.
- Real Time Market (RTM): Enables trade of electricity in 15-minute time blocks, typically an hour before delivery, allowing for real-time balancing of supply and demand.
- Long-Term Contracts and Power Markets:
These include structured mechanisms like Power Purchase Agreements (PPAs) and forward or futures contracts.
In such markets, the price, volume, and delivery timelines are agreed upon in advance, offering more certainty and stability for both generators and consumers.
● Who are The Market Participants of Energy Trading?
The energy trading ecosystem has these key market participants:
- Producers: Producers mean the companies that extract and refine fossil fuels, renewable energyfirms and power generators. These are companies that produce electricity from various sources, including coal, solar, nuclear, and gas power plants.
- Consumers: Consumers refer to industrial companies, such as large energy consumers who use electricity and other fuels for their operations.
- Traders: Power traders are individuals or companies that buy and sell energy commodities for profit, acting as intermediaries between producers and consumers.
- Speculators: They facilitate market entry for producers, consumers, and prosumers, enabling them to trade in wholesale markets.
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Energy Trading in the Indian Context
Energy trading in India involves regulated buying and selling of electricity via power exchanges (like IEX and PXIL), bilateral contracts, and open access markets, overseen by the Central Electricity Regulatory Commission.
India’s electricity market is structured around two broad categories:
- Regulated Market: Power procurement by DISCOMs under long-term PPAs.
- Open Access Market: Consumers with a requirement of 1 megawatt (MW) or more can directly purchase electricity from power generators through the open access market.
● Key Exchanges of Indian Energy Trading
The two main power exchanges in India that facilitate energy trading are the following:
- Indian Energy Exchange (IEX): Established in 2008, the dominant trading platform with over 84% market share in power exchange trading volume as of FY2025.
- Power Exchange India Ltd (PXIL): Another major power exchange in India, operating alongside IEXO. It offers products like Term Ahead Market (TAM), Renewable Energy Certificates (RECs), and more.
● Challenges in Indian Energy Trading
India faces significant challenges which can cause instability in market growth. Here is a detailed breakdown of the hurdles:
- Grid Infrastructure Constraints: Integrating renewable and decentralised energy sources demands substantial upgrades to modernise and expand existing grid networks.
- Regulatory Hurdles: While reforms have been introduced, fragmented regulations and inconsistent state-level policies continue to impede seamless power market operations.
- Market Price Instability: The variable and intermittent nature of renewable energy sources contributes to increased price volatility in the power trading
● Opportunities of Energy Trading in India in 2025
These are some of the unique opportunities of energy trading in India:
- Open Access Markets: Industrial and commercial consumers can directly procure power from generators. It creates opportunities for energy traders to offer competitive pricing.
- Cross-Border Electricity Trading: India’s strategic location allows for electricity trade with neighbouring countries, offering opportunities for regional energy cooperation.
- Electric Vehicle (EV) Integration: The growth of EVs presents new opportunities for energy trading as EVs can act as both consumers and suppliers of electricity.
- Renewable Energy Certificates (RECs): RECs provide an additional revenue stream forrenewable energy It enables green energy adoption.
To know more about Renewable Energy Certificates, you can read our detailed blog.
Innovations & Future Trends of Energy Trading in India
As renewable energy integration evolves, India’s power market is entering a phase of structural transformation. Here are some key trends to keep an eye on:
1. Blockchain Technologies
Blockchain technology will unite all the stakeholders under one decentralised network. It enables peer-to-peer (P2P) trading, especially useful for prosumers and decentralised grids.
2. Renewable Energy Expansion
Sources like solar and wind are becoming increasingly prevalent, changing traditional trading models and driving the need for new strategies to incorporate decentralised energy.
3. Energy as a Service (EaaS)
Energy as a Service model is emerging, where energy companies offer energy solutions as a service, including RECs, energy storage, and smart energy management.
4. Distributed Energy Resources (DERs)
DERs, such as microgrids and distributed generation, are changing the way energy is produced and traded, requiring companies to adapt their trading strategies.
Sunsure Energy’s Role in the Market
Sunsure Energy, as a leading renewable energy company in India’s renewable energy industry, plays a significant role in the trading market. We provide:
1. RE100 Solutions
Under this, we offer:
- RTC Power: We deliver 24/7 clean, reliable power by integrating solar, wind, and battery storage, tailored to meet the decarbonisation needs of energy-intensive industries such as Steel, Cement, Data Centres, Pharma, and Automobiles.
Check out Sunsure Energy’s Projects
Under this category, we provide the following services:
- Hybrid PPAs: Our innovative Hybrid Power Purchase Agreements integrate solar and wind to ensure a more stable and reliable energy supply than standalone renewables.
- Solar PPAs: We help to power your business with zero-upfront-cost Solar PPAs with clean energy, fixed tariffs, and lower carbon emissions.
- Wind PPAs: Stabilise power costs and meet sustainability goals with Sunsure’s Wind PPAs—customised, zero-upfront solutions that deliver clean, reliable energy from advanced wind farms.
Final Thoughts
Energy trading is the fuel of India’s renewable future. As the sector scales, trading platforms, instruments, and strategies will shape how efficiently and reliably power flows from clean sources to the end users.
As markets move towards decentralisation, digitalisation, and decarbonisation, the trading environment will be at the forefront of promoting India’s green energy goals.
