The CERC Regulations related to the “Procedure, Terms and Conditions for grant of trading licence and other related matters” and related to “Fixation of Trading Margin” were notified in 2009 and 2010 respectively and have been amended several times since then. Noting the major changes in the size and trends in the market over the past decade, the Commission has proposed to repeal and replace these regulations with the draft regulations.
The draft regulations have welcome provisions related to the compliance with license obligations especially related to payment security, capital adequacy, reporting of information and checking diversion of power without the sellers consent. These provisions will further aid the strengthening and deepening of competitive and efficient electricity markets in the country.

The draft regulations should also take into account these changes to ensure these licensees can function effectively in a changing environment with diverse risks and opportunities. Some of these, especially related to trading margins, instituting standards of performance and having disaggregated reporting formats are discussed in this submission.