(MENAFN- Live Mint) New Delhi: Power demand in September was high but volatile amid changes in weather and incessant rains in many parts of the country, particularly northern and western India.

Despite higher year-on-year demand in September, average power prices on the exchanges fell during the month, driven by increased supplies. On the Indian Energy Exchange (IEX), the average price of power in the real-time market declined 17% on a year-on-year basis to ₹3.31 per unit.

“September 2025 witnessed volatility in power demand and supply due to intermittent wind generation and monsoon variations, making demand and supply forecasting challenging,” said Rohit Bajaj, joint managing director, Indian Energy Exchange (IEX) , adding that during this period, the real-time market (RTM) proved instrumental by enabling participants to adapt swiftly to fluctuations through near real-time power procurement, while also supporting grid stability.

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In September last year, the average price on the real time market was ₹3.98 per unit. The electricity consumption in the country was 146 billion units in the country last month, 3.2% higher from 141.4 billion units in September last year. Consumption, however, was less than that in August (150.4 billion units).

An increase in supplies on the exchanges also weighed on prices. The sell bids on the exchange rose about 33% in September 2025 to 15.15 million megawatt hour (MWh), from 11.38 million MWh in September last year.

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Heavy rains in states such as Punjab, Himachal Pradesh, Uttarakhand, Delhi, Maharashtra, and Madhya Pradesh hurt power demand during the month. However, with rains subsiding in the later part of the month, demand and prices somewhat recovered.

According to data from the India Meteorological Department (IMD) , the country witnessed a 193.6 milimetre (mm) rainfall in September, compared to a normal of 167.9 mm. Northwestern and central India witnessed 30.7% and 43.7% higher rainfall than the normal rains.

On 30 September, market clearing prices of power on the real time market was ₹3.2 per unit, compared to ₹1.67 a month ago. On 1 September, the market clearing price was at ₹1.4 per unit, and had touched a high of ₹5.3 on 9 September.

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Data from the Grid Controller of India showed that the country's peak power demand was around 200 GW initially in September, before increasing later. On 29 September, the peak demand was at 226 GW, compared to 202 GW on 1 September.

IEX's Bajaj said that amid the volatility in demand-supply dynamics, distribution companies and commercial & industrial (C&I) consumers leveraged real time market's flexibility to optimize procurement costs.

“The average RTM price stood at ₹3.31 per unit, reflecting a year-on-year decline of approximately 17%. Market participants took advantage of these lower prices, substituting more expensive power with exchange-based procurement, thereby reducing overall costs and contributing to increased volumes in the RTM segment,” he said.

Going ahead, with the IMD projecting normal-to-above-normal rains to continue, and a delay in withdrawal of the southwest monsoons, the demand and prices are likely to remain volatile. IMD in its latest outlook has said that the monthly rainfall over the country as a whole during October is likely to be above normal or greater than 115% of the long-period average.

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