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Volumes in 2012 on European Power Exchange EPEX SPOT hit new record

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08/01/2013

Paris

Swiss Day-Ahead volumes increase by 38 % ― Spot market gains in importance

Paris, 8 January 2013. Volumes on the European Power Exchange EPEX SPOT have seen a solid growth in 2012: 339 TWh were traded on EPEX SPOT markets, which corresponds to an 8 % increase compared to previous record year (314 TWh).
Overall, EPEX SPOT has benefitted from the trend towards short-term power trading. Uncertain economical, legislative and regulatory frameworks as well as the growing share of fluctuating renewable power sources have made spot markets all over Europe highly attractive: They offer the needed short-term flexibility, are highly liquid and hence send out a reliable price signal.

Day-Ahead markets

The 2012 trading volume in the Day-Ahead auction for the market areas Germany/Austria, France and Switzerland on EPEX SPOT accounted for 321 TWh (296 TWh in 2011).
The year-on-year growth rate of 38.3 % of the Swiss Day-Ahead market is outstanding. New members on the Swiss market, increased cross-border arbitration possibilities and ongoing liberalization have had a tangible impact on trading volumes in 2012, as well as for the precedent year.
The growth of the German Day-Ahead market volumes since the beginning of 2010 is on the one hand due to the legal obligation of Transmission System Operators (TSOs) to market power from renewable energy sources (RES) on the spot Exchange, according to an ordinance specifying the German law on RES, the Erneuerbare Energien Gesetz (EEG). On the other hand, new schemes of direct marketing introduced in January 2012 have been increasingly used by producers of RES. In both cases, the spot market has proven to be a suitable instrument for the marketing of those energy sources. 
The French Day-Ahead market displays stable results. In consideration of the legal framework in France, offering regulated access to electricity from nuclear power plants for alternative suppliers, these trading volumes are a positive signal. They show confidence of the actors in the market’s liquidity and price signal.
Day-Ahead trading volumes were totalling 321,228,968 MWh and can be broken down as follows:

Areas

Volume 2012

in MWh

Volume 2011

in MWh

Average Base Price 2012 / 2011

Euro/MWh

DE/AT

245,268,525

224,550,815

42.60 / 51.12

FR

59,282,499

59,692,111

46.94 / 48.89

CH

16,677,944

12,060,799

49.52 / 56.18


Market Coupling, a tool to manage capacity congestion between national power spot markets by optimizing cross-border flows, is a core service EPEX SPOT is delivering for the benefit of society: Power Exchanges’ orders and available cross-border capacities received from the TSOs are implicitly auctioned, enabling the trading of power and capacity at the same time. This optimizes the use of existing infrastructure and increases the social welfare for all market actors.
Since 9 November 2010, the power markets of Central Western Europe (CWE), including Germany, France and the Benelux countries, have been successfully coupled. By allowing for an optimal use of cross-border capacities, market coupling favors price convergence. As a result, a 64 percent price convergence was observed on EPEX German and French markets in 2012.

Intraday markets

The Intraday markets of EPEX SPOT, covering France, Germany and Austria, keep growing as well. After a remarkable volume development in 2011, the Intraday markets continued to display solid results during 2012. With the launch of the Austrian Intraday market on 16 October 2012, EPEX SPOT extended its Intraday offer to a third country. The Flexible Intraday Trading Scheme (FITS), launched on 14 December 2010 to facilitate trading between France and Germany, now allows seamless implicit cross-border trading between France, Germany and Austria. In this way, the Austrian Intraday market also benefits from the tight integration with the French and German markets. Over the year 2012, cross-border trades accounted for 13.5 % of traded volume on FITS. A Swiss Intraday market operated on the same model will follow in Q2 2013.

Total trading volumes on the Intraday markets amounted to 17,924,234 MWh, including:

Areas

Volume 2012

in MWh

Volume 2011

in MWh

DE/AT

15,757,403

15,897,935

FR

2,166,831

1,694,545


Liquidity on the French Intraday market has sharply increased, by 28 % from 2011 to 2012. This is due to intensive use of the local market during cold spells as well as to cross-border trading since the launch of FITS, positively impacting neighbouring markets
To handle the growing share of power from fluctuating renewable energies, EPEX SPOT is offering flexible 15-minute contracts on the German market since 14 December 2011. They allow the members to balance their portfolios every 15 minutes. In 2012, the traded volume from 15-minute contracts amounted to 1,288,883.5 MWh, which represents 8.2 % of the total traded volume on the German Intraday market. By offering these contracts on the German Intraday market, EPEX SPOT contributes to facilitate the German energy transition.

* * *
EPEX SPOT SE operates the power spot markets for France, Germany/Austria and Switzerland (Day-Ahead and Intraday). Together these countries account for more than one third of the European electricity consumption. EPEX SPOT is a Paris-based company under European law (Societas Europaea) with a branch in Leipzig.
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