By the OGJ Online Staff
HOUSTON, Feb. 21, 2001The UK’s International Petroleum Exchange (IPE) will launch its electricity futures contract March 19, subject to government confirmation expected March 16.
The go live date for the New Electricity Trading Arrangements (NETA) is scheduled for March 27. More than 30 current natural gas users are ready to begin trading the contract, IPE said.
The IPE electricity futures contract will trade on the IPE’s electronic energy trading system (ETS II), alongside the IPE’s natural gas futures contract, creating the UK’s first integrated utilities marketplace.
The first contract month for electricity futures will be May 2001. The contract will be cleared by the London Clearing House, which will act as central counterparty to all trades. Margin offsets with natural gas futures will be considered once sufficient price history has built up, the IPE said.
The electricity futures contract will be a base load contract consisting of daily, balance of the month, monthly, quarterly, and seasonal contracts. IPE customers will be able to act as an energy contract volume notification agent (ECVNA) themselves or appoint a third party ECVNA if they wish.
The IPE has set the trading fees at a level equivalent to 0.1pence/MW-hr. The fee for a monthly contract will be 72 pence/lot side, and for a daily 2.5 pence/lot side.
Isabella Kurek-Smith, head of IPE Utility Markets, said, “We are delighted to be offering our members and the industry an electricity futures contract, which will provide risk management opportunities under NETA, and will complement our successful natural gas contract.”
IPE gas futures were launched in January 1997 and currently trade an average of 2,000 lots a day.