Glossary
Ask
Sell order
Auction
Form of trading for ascertaining the price and also matching of buy and sell orders to form transactions. During the auction all the orders in the order point are matched to form transactions at a specified point in time. Usually that price is established as the auction price at which the biggest quantity of contracts is bought and/or sold.
Balance Area
Energy account which the transmission system operator keeps for every user of the system. This system is in accordance with a balance area agreement. In the account feeding, withdrawals and the transfer of energy to other balance areas (schedule) are booked in order to establish the deviation in the energy balance of every user.
Balance Area Agreement
All contractual agreements between the transmission system operator and the grid user regarding the settlement of power deliveries.
Balancing Area Responsible Party
Grid user as counterparty of a balance area agreement which is responsible for the settlement of balancing group deviations.
Base Load
Characterises the type of load for the delivery of electricity or the procurement of electricity with a constant output over 24 hours of each day of the delivery period.
Batch processing
Daily vespertine process of the clearing house. It includes position keeping as well as calculation and posting of margins for all transactions that are cleared and settled by the clearing house.
Bid
Buying order
Block Order
Combination of up to 24 partial orders regarding hour contracts for power. The partial orders have to refer to different hour contracts of the same delivery day and of the same place of delivery (TSO). A block bid can be a buy order (all partial orders are buy orders) or a sell order (all partial orders are sell orders). All partial orders of block bids are either executed jointly or in isolation.
Call for additional cover
If the deposited margin of a Clearing Member or Non Clearing Member does not fulfil the requirements of the daily calculated margin (under funding) the Clearing Member or Non Clearing Member is requested for additional cover (margin call). Clearing members and Non Clearing Members have to fulfil the additional payment.
Clearing
Financial and physical settlement of transactions as well this should be 'collateralisation' of transactions.
Clearing House
An institute which acts as a central counterparty for transactions (CCP). The clearing house organises the accounting of receivables and liabilities, the delivery of the transactions and the collateralisation of the transactions.
Clearing Member
Participant in the clearing procedure who has a clearing license.
Continuous Trading
Unlike in an auction, price formation in continuous trading is done during a given period of time in which transactions take place continuously. As soon as two orders are executable they will be matched immediately. Competing orders in the order book are prioritised by firstly price and then time
Control Area
Defined grid area with regard to which a transmission system operator is responsible for balancing. Control areas serve as places of delivery of power contracts.
Day-Ahead Market
Part of the spot market where a commodity is tradable one day before delivery.
Delivery
The physical fulfilment of transactions is called delivery.
ECC
European Commodity Clearing AG. Central counterparty for all transactions effected on EPEX Spot SE (as of April 1st for French contracts).
Exchange Member
Company which is licensed by the exchange as an Exchange Member on the spot market.
Exchange Trader
Employee of a trading participant which is admitted by the exchange as a trader.
Iceberg Order
Buy or sell order which is specified by means of its limit, total quantity and peak quantity. The Iceberg Order is placed in the order book in partial orders to the amount of the peak quantity. As soon as a partial order has been executed, a new partial order to the amount of the peak quantity is placed in the order book. This process is repeated until the total quantity of the Iceberg Order is executed.
Initial Margining
The initial margin covers the intra-day risk from spot market transactions on power.
Intra-Day Margin
Additional margin which has to be deposited in the course of an exchange trading day in highly volatile market situations.
Intra-Day Market
Part of the spot market on which the trading participants can trade a commodity up to one hour prior to the beginning of the delivery.
Limit order
Buy or sell order which is entered with a position limit; it is executed at this limit or at a better limit.
Long position
The trading participant holds a long position after buying a security (e.g. a futures contract). The long position remains until the maturity or close-out of the position.
Margins
Margin to be furnished in cash or in securities which the Clearing Member has to deposit with the clearing house and which the Non-Clearing Member has to deposit with its Clearing Member.
Market Clearing Price
Synonym for auction price. The market clearing price corresponds to the intersection between the aggregated supply and demand curve.
Market Coupling
Market Coupling is a method to manage capacity congestions between adjacent power spot markets. In general this is designed as an implicit auction and requires a coordination of spot auctions of the exchanges involved.
Market Maker
A market maker is a trading participant who holds a bid and an ask order (quote) simultaneously for a minimum period of time on the exchange trading day. Market makers serve to ensure basic liquidity.
Market order
Buy or sell order which is entered without a price limit. The unlimited order is executed at every price.
Matching
Combining of performable contracts in the order book.
MCP
Abbreviation for market clearing price
Mistrade
A transaction which was effected as a result of a misentry is called mistrade.
