Electricity
Utilities cut spending on IT
Energy utilities have cut spending on IT by 13% so far this year, according to the initial results of a study by Connecticut-based consultancy the Meta Group.
Both sides of the fence: a statistical and regulatory view of electricity risk
Ernst Eberlein and Gerhard Stahl analyse price series of 25 energy spot rates simultaneously using Lévy models. This model class allows the capture of stochastic behaviour of these financial instruments. The implications of this analysis will form the…
Isda and EEI collaborate on Power Annex
The New York-based International Swaps and Derivatives Association (Isda) and US trade body the Edison Electric Institute (EEI) published a North American Power Annex to the Isda Master Agreement in August.
Joining up the markets
The Amsterdam Power Exchange has recently developed a market-coupling system. This spot market system supports international trading – linking two independent markets based on area-based elasticity curves, it also allows flexible block orders
In search of power solutions
Blackouts across Italy in early July highlight the need for power plant investment – and the new market operator says promotion of derivatives trading is necessary to encourage such investment. But producers are yet to bite, finds James Ockenden
Keeping up with the markets
The power trading sector has changed substantially in the past 12 months. Have trading and risk management software vendors kept pace? Kevin Foster reports
California’s master plan
California’s energy regulators have an action plan to upgrade the electricity system. But if they don’t add generation, shortages could again hit. Kevin Foster reports
...while AEP exits Nordic energy trading
Ohio-based American Electric Power (AEP) last month completed its exit from theNordic energy trading market. The management team responsible for AEP’sactivities in the Nordic region will assume AEP’s Nordic trading book,office leases and related…
US power sector decline slows, says Fitch
The US power sector has seen little more than a slowing in the rate of its declinein 2003, said Richard Hunter, managing director of rating agency Fitch’sglobal power group, in May.
Power asset prices plummet
The energy price boom may be over, but bargain hunters beware: the predicted sale of US generation assets is yet to occur. Kevin Foster reports
The case for financially settled contracts
Banks and hedge funds have shied away from trading electricity due to fear and ignorance of the physical nature of the market. But, as Todd Bessemer of Accenture points out, financially settled contracts can avoid the complexity of physical delivery and…
A Spanish power struggle
A takeover bid by gas distributor Gas Natural for power utility Iberdrola may provide the impetus for much-needed competition in the Spanish energy market. But the bid has upset many traditional links in politics, finance and business. By Maria Kielmas
The LMP supermodel
With Ferc’s standard market design (SMD) seeking a shift from zonal power pricing to nodal pricing, the concept of locational marginal pricing (LMP) has become a key policy issue. Henwood Energy’s Vikram Janardhan proposes 10 key modelling features to…
Seam shifts in central Europe
Gordon Feller looks at the changing coal economies of Bulgaria, the Czech Republic and Slovenia and the effect of electricity sector moves in the region
Climbing the competition Pole
The Polish government hopes to boost competition in the electricity market through a controversial securitisation plan that it will use to buy out long-term contracts between generators and the transmission grid operator. Maria Kielmas reports
Exchanges gradually gain pace
After much talk of new trading solutions for German power, only one platform – EEX – has made significant progress, although the new clearing solution from Clearing Bank Hannover seems to be picking up steam. James Ockenden reports
The bigger they come…
The German market is at the heart of the European power business, but it has stuttered since its early promise, and has yet to set the pace for the region as a whole. From a new entrant’s point of view, this is only to be welcomed, argues Ben Tait
Option pricing for power prices with spikes
European power prices are very volatile and subject to spikes, particularly in German and Dutch markets. Ronald Huisman and Cyriel de Jong examine the impact of spikes on option prices by comparing prices from a standard mean-reverting model and a regime…