Innogy plc, the UK multi-utility, has launched a new option-based management designed to offer a form of coverage to participants in the UK power market which will allow them to protect themselves against a shortfall at short notice, without risking highly volatile physical market prices.
The web-based product, called Innsure, will make blocks of electricity available via weekly and daily auctions. When needed, this electricity is then called for at only 6 hours notice.
Brian Senior, Innogy’s Director of Trading & Asset Management said, “InnSure allows participants in the UK electricity market to cover shortfalls cost effectively to the short term benefit of participants and the long term benefit of customers. It provides this protection at a price fixed in advance”.
Demand for short-term fixed-price cover may result from a sudden cold snap, an unplanned plant outage or problems restarting, particularly during peak hours, said Senior.
The product will be available from December 6 and Innogy will back the options with power from its portfolio, with oil-fired generators such as Littlebrook or Fawley likely, but not guaranteed, to provide a lot of the power, director of trading Tony West said.
Innogy said that it may offer other new products over the coming months, to assist those involved in Neta, as well as refining Innsure.