IEX Market Coupling Case — Stock up 13%; CERC lawyer says will take instructions on order withdrawal

Shares of Indian Energy Exchange Ltd. (IEX) gained 12% on Tuesday, January 6, as the Electricity Appellate Tribunal's (APTEL) hearing with regards to CERC's market coupling norms was underway. The power exchange had also reported its business update for the third quarter on Monday.

CERC told APTEL it will have to consult and seek instructions on withdrawal of the order. It said it wanted to make the coupling order more consultative, fair and transparent. It said will take up the issue with CERC members, will take instructions on withdrawal of coupling order.

APTEL observed that it was told the market coupling order was done only for some officers to make money.

It said it saw a lot of theatrics in the making of the coupling regulations. Theatrics are a cause of concern; regulation could

have been done quietly by CERC, the tribunal observed.

It said it expects CERC to be independent, above suspicion like Ceaser's wife. If there is something amiss, it would like to inquire and take action to avoid a repeat of the incident, it added.

IEX observed that even without the Securities and Exchange Board of India's (SEBI) findings on insider trading, the CERC's coupling order is wrong and needs to be set aside.

During the previous hearing on November 28, 2025, the tribunal said it was concerned about the allegations made across the bar and wished to inquire further as these allegations, if found to be true, "would cast a cloud on the manner in which an independent regulator functions."

It emphasised the need for an early hearing, well before the regulations are notified.

IEX Plea 

IEX is seeking the setting aside of the CERC order on market coupling, and till the case is decided, it is seeking a stay on the order.

The IEX petition claims that the CERC order is arbitrary and violates the principles of natural justice. It claims that the coupling order will only lead to the loss of market share without any conceivable benefits.

CERC Norms

In July 2025, the CERC approved the implementation of the market coupling norms, with the day ahead market (DAM), in accordance with the Power Market Regulations of 2021.

As per the first phase of the norms, DAM coupling will be implemented by January 2026, as per which, different power exchanges will act as market coupling operators (MCOs) on a round-robin basis.

An MCO collects all buy and sell orders from all power exchanges, which is then aggregated and matched to discover a uniform market clearing price across all exchanges, regardless of the platform.

The CERC staff will also initiate stakeholder consultation for DAM coupling and propose the required regulatory amendments.

Grid India will serve as the fourth MCO for backup and audit purposes. It will also develop a software for term-ahead market coupling, run a three-month shadow pilot for the same and submit the feedback after the process is done.

For the real-time market, coupling will be considered at a later stage after the DAM experience as it requires further regulatory and operational examination.

The petition adds that the CERC order disrupts regulatory framework which has evolved over the past 17 years.

Here's why Market Coupling is negative for IEX

The decision to implement market coupling against the report submitted by Grid India is a negative development for IEX as this means it will lose its business moat of being the "best platform" for price discovery.

Also, the introduction of market coupling could meaningfully shift volumes to competitive exchanges. At present, IEX has a market share of nearly 85% in the spot market.

Insider Trading Allegations

During the previous hearing on November 28, 2025, IEX had cited the Securities and Exchange Board of India's (SEBI) report claiming CERC officials had indulged in insider trading and made illegal gains of ₹173 crore.

IEX told APTEL the coupling order, which caused its shares to plummet 29% in a single session, was part of the insider trading conspiracy by CERC officials. It said the coupling order is tainted and the Securities and the market regulator also named the author of the coupling order.

APTEL then observed that it is open to look into any case of corruption and that the regulator should avoid any appearance of wrongdoing.

Click here to check the timeline of events from July 2025

IEX Q3 business update

IEX's electricity traded volume in the third quarter increased 11.9% to 34.08 billion units from the previous year.

Its DAM volumes declined 2.8% to 16,250 million units from 16,712 million units in the year-ago period.

Its real-time electricity market volume increased 35.7% to 12,650 million units from 9,322 million units in the previous year.

IEX's day ahead contingency and term-ahead market volumes increased 29.% to 2,535 million units.

In December 2025, the monthly electricity traded volume was at 11.44 billion units, up 2.8% from the previous years. The DAM segments volumes declined 11.6% to 5,899 million units. Meanwhile, the real-time electricity market volume was up 20.5% at 3,833 million units and the day ahead contingency and term-ahead market volumes surged 87% to 931 million units in December 2025.

Shares of IEX were up 12% during the hearing around 3.10 pm on Tuesday.

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