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Global Power Derivatives Newsletter | May 2024 |  |
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Dear Customers, Partners and Friends,
Power derivatives markets continue to soar in 2024 with record trading volumes on core EEX markets, triple-digit growth on others and an overall optimism within the trading community.
We have a positive outlook on the future of these markets and continue to encourage further liquidity through the launch of new products that address real market needs. Over a month ago, we introduced our Nordic Zonal futures to provide a wider variety of hedging tools for this region. We have already seen significant activity in our order books but there is no rush, we are patient and in it for the long run! We understand that market participants have to evaluate their individual circumstances and wait for the right moment to update their strategy.
Of course, we are not losing sight of our other markets. We are about to celebrate the fourth anniversary of our Japan Power operations and we are excited to tell the great story of growing liquidity and remarkable trading volumes over the past years on this market!
Finally, we continue to improve your experience with us through additional services. Our cloud-based A7 Analytics Platform supports your everyday decisions by enabling access to a wide range of trading data and analytics capabilities, while Lacima’s price and risk management tools can support with your strategic planning.
I hope you will enjoy our newsletter,
Steffen Köhler
COO | EEX
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| | 2024: continued volume growth on power derivatives markets | |
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In the first quarter of 2024, we have seen a continued expansion of trading volumes across the EEX power derivatives markets.
Highlights from Q1:
We conducted a highly successful market making tender for our Dutch Power Futures market in order to further drive liquidity. We've also reached a record market share of 89% on this market in March.
In Q1, we reported new monthly trading volume records in German and French Power Futures
This year, we have already seen 24 long-term deals registered in Spanish Power Futures, raising the total number of such transactions to over 100 since launch
We had two market makers join our Polish Power Futures markets, driving further liquidity
Our Japanese power derivatives market has broken numerous records in terms of volumes at the beginning of the year and interest continues to grow, with triple-digit growth YoY
For more details on trends and developments over the first quarter of 2024, as well as our planned roadmap for the rest of the year, watch our recent webinar.
Our expert power derivatives team publishes monthly updates on the markets we are present. To view the latest report, click here.
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| | | REMIT II entered into force | |
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REMIT II marks a significant milestone in the enhancement of market integrity and transparency. We welcome these changes as we as EEX stand for transparent and safe trading.
We encourage all market participants to get up to speed with the new regulation, including definitions, reporting requirements and notification obligations related to algo trading and direct electronic access. It is also important that market participants outside the EU will need to have a designated representative in an EU Member State from 8 November 2024.
Rest assured, the EEX Transparency Platform already fulfills the REMIT II requirements.
For more information, read ACER's Open Letter.
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| | Updates from the Nordics | |
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Our Nordic Zonal Futures launched on March 25 with promising trading levels seen over the first month, with about 30 participants already active in these new products. Order numbers grow by the day and traded volumes have already reached close to 237 GWh. Several transactions have taken place in the DK1, DK2, SE2 and SE3 zones, both via the EEX order book and trade registration, with further zones seeing activity in the order book.
Our new products refer to specific delivery points to enable more precise hedging and pricing, and help future-proof against bidding zone reconfigurations. Learn more here.
Margin efficiencies of our new, extended offering have also been acknowledged in a report by SVK, which you can read here.
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FOR ALL VIDEO CONTENT - MAKE SURE TO CHECK OUT EEX TV
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| | | Market Data Services: A7® Analytics Platform | |
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The A7 Analytics Platform is a cloud-based platform that provides trading data and analytics capabilities in a single solution.
It offers access to order-by-order historical and intraday market data at nanosecond granularity for all EEX derivatives market products. Within their core applications, users can navigate between dates and products of interest, interactively visualise the full depth of the order book events and implement customised metrics or test scenarios for executing algorithms using co-location quality data.
To learn more, book a demo with us.
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| | PPA pricing and risk management | |
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According to a recent report by Reuters, a record 60% of Europe's electricity was powered by clean energy sources during Jan-Feb 2024, driven by strong year-on-year growth in hydro, solar and wind generation and a rebound in nuclear power production.
This growth has left some energy market participants rushing to come to grips with how to price Power Purchase Agreements and manage risk for this rapidly growing asset class.
To learn how to effectively assess the value of PPA trades and manage portfolio risk, watch Lacima’s ‘Pricing and risk management of Power Purchase Agreements for renewables’ masterclass.
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Meet us
EEX Group Traders' Reception | 28 May, Stockholm - Register here
Japan Power Workshop & Reception | 29 May, Tokyo
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Madrid Workshop & Reception | 6 June, Madrid
EEX Group Traders' Reception | 12 June, Helsinki
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| | Beyond Power Derivatives | |
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We recently expanded our product offering on the natural gas derivatives markets with new, financially settled EEX TTF Natural Gas Month Futures denominated in US$/MMBtu. Learn more here.
EEX and the Turkish energy exchange Enerji Piyasaları İşletme A.Ş. (EPİAŞ) recently signed a MoU to underline our joint commitment in developing the Emissions Trading System in Türkiye.
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© 2024 European Energy Exchange AG http://www.eex-group.com
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