New Delhi, May 28 -- In an unprecedented development, India's spot power prices fell to zero on May 25 because of the subdued weekend demand, says a report by IIFL Capital.

The situation came due to the twin impact of early monsoon rains and a huge 25-gigawatt solar capacity addition over the past year.

According to the IIFL Capital report, the situation was further compounded by limited thermal power backup, which created a rare surplus that sent prices on the power exchange tumbling to the bottom.

The situation arises because India has not created a sufficient pumped or battery power storage system to store the surplus power generation. The IIFL report analysed the impact of the incident on various parts of the energy ecosystem.

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