Both power and energy are a commodity capable of being bought, sold, and traded. An electricity market is a system enabling purchases, through bids to buy; sales, through offers to sell; and short-term trades, generally in the form of financial or obligation swaps.

 

Power is increasingly considered an important resource that will be used efficiently in the production process. Europe with its 500m citizens and 20m Enterprises is the largest energy market in the world.

At a high level, the electricity market in Europe allows:

  • Customers to use the supplier of their choice.
  • Suppliers to buy electricity to meet the demands of their clients from the generators of their choice.
  • Organisations without any physical demand for electricity or any means of generating electricity to trade power.

Regarding power procurement, the complexity of the electricity market often leads to high uncertainty of the purchasing agents in the companies. This is due to price fluctuations, uncertain future incidents and complicated trading structures. This is why industrial enterprises often revert to their comparatively expensive regional energy providers.

For quite some time, the cross-border trade is not unusual in the energy market anymore. Many energy suppliers choose an international alignment. Similarly, the European energy wholesale and trading companies of Forable belong to these international acting market participants.

USE LIQUID TRADING MARKETS

Pursuant to the Stock Exchange Act, energy is considered as a commodity which can be traded at market prices. In the course of the EU‐wide liberalisation of the energy markets, several energy exchanges have been established. All these energy exchanges operate on SPOT markets where electricity is traded with short‐term physical delivery.

A few European energy exchanges have a future market. This is where future transactions are concluded by using financial and physically delivered future contracts. At the European Energy Exchange (EEX) in Leipzig, it is possible to act on both markets and thereby benefit from all advantages offered.

Many developments in the wholesale area have proceeded since the market liberalisation. These events induced a higher market liquidity that is a prerequisite for an unlimited competition and the reduction of market entry barriers. Altogether a continuous increase of market participants at the trading points is recognisable which has led to a growth of trading volumes. These market developments are important requirements for the accruement of an active competition. Companies realise that an intensive market observation and active participation can lead to competition-enhancing advantages.

ENERGY EXCHANGES IN EUROPE

APCS – Power Clearing and Settlement | Austria
Borzen – Slovenian Power Market Operator | Slovenia
CEGH – Central Europe Gas Hub | Austria
CROPEX – Croatian Power Exchange | Croatia
EEX – European Energy Exchange | Germany
ELEXON | England and Wales
EPEX SPOT – European Power Exchange | France
EPİAŞ – Energy Exchange Istanbul | Turkey
ESCO – Electricity System Commercial Operator | Georgia
EXAA – Energy Exchange Austria | Austria
GME – Gestore dei Mercati Energetici | Italy
HROTE – Croatian Energy Market Operator | Croatia
HUPX – Hungarian Power Exchange | Hungary
IBEX – Independent Bulgarian Energy Exchange | Bulgaria
ICE ENDEX | Netherlands
LAGIE – Hellenic Electricity Market Operator | Greece
Nasdaq CommoditiesNorwayNord Pool | Norway
OKTE – Short-term electricity Market Operator | Slovakia
OMIE – Operador do Mercado Ibérico de Energia | Spain
OMIP – Operador do Mercado Ibérico de Energia (Pólo Português, S.G.M.R., S.A.) | Portugal
OPCOM – Romanian Electricity and Gas Market Operator | Romania
OTE – Czech electricity and gas market operator | Czech Republic
Powernext | France
PXE – Power Exchange Central Europe | Czech Republic
SEMO – Single Electricity Market Operator | Ireland
TGE – Polish Power Exchange | Poland