Kerala State Electricity Regulatory Commission (KSERC) has granted post-facto approval and ratification to nine power banking and swap arrangements entered into by Kerala State Electricity Board Limited (KSEB) between July 2025 and May 2026. The Commission issued the order on August 18, 2026, following a petition filed by KSEB under Regulation 78 of the state tariff regulations and the Electricity Act, 2003.
KSEB used power banking arrangements to manage seasonal variations in electricity availability and demand. During July and August 2025, strong monsoon rainfall resulted in high hydroelectric generation and excess power availability. At the same time, the board needed to manage reservoir levels before the planned maintenance shutdown of the Moolamattom Powerhouse in November 2025.
To utilize the surplus, KSEB banked around 367.7 million units of round-the-clock power with utilities in Chhattisgarh and Punjab and trader Manikaran Power Limited. These entities subsequently returned more than 384 million units to Kerala between November 2025 and February 2026. The return obligation under these arrangements ranged from 103% to 105% of the energy banked.
KSEB also used banking arrangements to meet short-term peak demand. In July 2025, it procured 37.2 million units from Andhra Pradesh Central Power Distribution Corporation Limited through an over-the-counter platform and returned 38.688 million units in October 2025. Another arrangement with Madhya Pradesh Power Management Company Limited provided 76.55 million units during peak and off-peak night hours in August and September 2025, which KSEB returned between December 2025 and February 2026.
Ahead of the anticipated summer power shortage in March-May 2026, KSEB entered into additional forward banking arrangements. Punjab State Power Corporation Limited supplied 292.8 million units during March and April, with the return scheduled from mid-June to August 2026. Uttar Pradesh Power Corporation Limited supplied 147.2 million units under two separate over-the-counter agreements during March and April, with returns scheduled between June and September 2026.
The Commission observed that although prior approval is generally required for power procurement, regulatory provisions permit short-term banking arrangements in contingency situations, subject to subsequent filing and supporting details.
Considering the operational requirements, grid stability benefits and cost optimization achieved through the transactions, KSERC ratified all nine arrangements and disposed of KSEB’s petition.
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