Forward Markets Commission (FMC) on Monday moved the Supreme Court over the dispute over who would regulate power futures-the FMC or the electricity regulator.

Earlier this month, the Central Electricity Regulatory Commission (CERC) and the Multi-Commodity Exchange of India (MCX) had also approached the apex court challenging the Bombay High Court?s judgment that held that neither the commodity regulator (FMC) nor the power watchdog CERC has the exclusive regulation over futures trading in electricity.

A bench headed by Justice GS Singhvi has issued notice to all the three parties till now besides Power Exchange of India (PXIL), Indian Energy Exchange, the Centre through Cabinet Secretary and the ministry of law and justice.

CERC oversees PXIL, a spot exchange that offers ?day? and ?week ahead? trading in power. It is promoted by NSE and commodity futures exchange NCDEX.

FMC in its cross-appeal said that it has dealt with 107 commodities since 1952 and electricity is also a commodity to be dealt with accordingly.

It said that CERC can?t have jurisdiction as the Electricity Act 2003 has no provision to deal with forward contracts in electricity, which are standardised contracts of financial nature as opposed to merchandising contracts and are intended to discover prices for future dates and provide a price risk management tool for such future dates.

?The high court overlooked and failed to consider that forward markets are essentially notional or virtual in character because they are dealing in financial instruments and not in physical transactions. It does not matter whether the commodity is an agricultural commodity or electricity or carbon credits, the petition stated.

CERC had earlier contended that the high court had not taken into consideration the fact that the power regulator has been granted exclusive rights by the government on any kind of electricity trade through the Electricity Act, 2003.

?The high court has failed to appreciate that due to extremely complex and vital nature of the electricity sector, it is imperative that all regulatory aspects pertaining to the sector are dealt with exclusively by a single regulator that has an in-depth understanding of the complexity and dynamics of the electricity sector as well as the legal and regulatory framework,? it stated.

The row began after PXIL, in early 2009, drew CERC?s attention to MCX?s launch of electricity futures based solely on an approval by FMC, which it termed as ?incorrect.? PXIL said that electricity futures are within the domain of CERC.