CME/ICE Integration in Power

Discussion in 'Commodity Futures' started by sledged, Oct 8, 2008.

  1. sledged


    Is something going to change with Electricity platform on ICE? I heard something about the CME integrating with ICE and there will be more people now trading Electricity on ICE. Does anyone know anything on what I am talking about?
  2. Haven't heard anything like that, and I talk with the Ice power rep at least a couple of times a week. Of course the info might not be public, so he didn't clue me in, but its doubtful.

    Bal day volume has dried up as of late (10-20k of mw), and next day PJM has come close to trading more than bal day a few times in the couple of weeks.

    CME/Nymex is in competition with Ice. Ice is going to move their clearing from LCH to Ice clear in the next month or so, and then Ice will stomp them even more than they do now in power.

    Where did you hear this info?
  3. sledged


    I just heard it from another guy that trades power. Its interesting that you mentioned the low volumes of bal days that have been traded lately, to see some days where Cin Hub has as many pieces traded as WH is pretty odd. I just attributed it to the fact that prices have been pretty tame and there isnt the dispatch volatility that you see when outage season is in full effect or when temperatures bring the loads up.

    A buddy of mine thinks the lack of volume has to do with the Banks/HF's, etc.. and all they are going through, they arent assuming as much risk in power and thus minimizing the counterparties in the market and minimizing volume.
  4. I don't think the lack of volume has to do with the banks ect. bringing exposure down with power, it has to do with the vol sucking as of late (except today in PJM, was an awesome day).

    eWith a $4 range in bal day, I'm doing maybe 100 megs round trip the whole day, when in the summer I might do 2000 mw of bal day and 3000 of daily. It wasn't unusual for me to do 20+% of the volume in daily, but these days, with no vol, the money just isn't there. Can't squeeze blood from am turnip.
  5. robbyusa


    Its almost futile to trade PJM or MISO lately...cause you know where it is gonna clear within $5 everyday. This sux.
  6. Couldn't agree more. Seeing bal mo @ 62ish in PJM is just disappointing because I don't have much to look forward to :)

    On the plus side, Monday PJM traded $67 today... sigh...

    Summer, I hardly knew ye
  7. I don't think we'll see CME and ICE doing any business together anytime soon. Something has to done to boost the electricity markets and I would expect a NYMEX electricity product to emerge as competition for the ICE products. That will open the door for more spreading and arbitrage. Bringing them together is nonsensical.
  8. Nymex already has competing power products. There are no arbs going on because hardly anyone trades nymex power. Their contracts are 1/20th the size of Ice and their margins are higher.

    The small amount of nymex power that is traded is a result of people exercising options and being forced to take nymex power.

    Unless CME puts power on globex, things will remain the same. Even if they did, a transition is unlikely.
  9. sledged


    Peak of outage season, 80+ degree temps. $51 clear WH yesterday. It better get really cold this winter cause with $6.50 gas the volatility will be gone.
  10. Man you aren't kidding. I feel like i'm having to work alot harder to make less money these days...Man, that was awesome yesterday when dispatch went to $20 and everyone sold... only to have APS pop up right after... something seems fishy there if you ask me, but I was long so no complaints here...

    Check your PM sledged.
    #10     Oct 14, 2008