• Total volume traded and cleared 92.3 TWh, up by 4% from 2013
• Power UK and Belpex markets experience yearly records
• APX reaches an all-time membership high: a total of 181
• Significant progress in European market integration
• New products and initiatives introduced across the APX markets
AMSTERDAM/BRUSSELS/LONDON, 14 January 2015
Power spot and clearing exchange APX witnessed another year of growing volumes and memberships in 2014. During its first operational full year as a dedicated power spot exchange, APX recorded a total of 92.3 TWh traded and cleared on the exchange, exceeding the previous year’s volume by 4%.
The changing European energy landscape provided a challenging and interesting environment to operate in. The focus for APX has remained the provision of reliable and robust trading and clearing solutions. APX has continued its role as a driving force for European electricity market integration and has also started the groundwork to develop the next generation of products and solutions to support the changing dynamics of the European electricity market.
“Year 2014 marked an important and exciting year for us. We continued to operate robust and liquid power markets in the Netherlands, UK and Belgium and reached an all-time high volume of 92 TWh with record growth of new members joining APX, over 180 memberships now across our markets. We also witnessed significant milestones being reached on the European electricity market integration. This, combined with the trend of trading shifting towards real-time, has provided us with opportunities to provide new, innovative solutions to our trading members”, says René Kerkmeester, CEO of APX.
A total of 92.3 TWh was traded on the APX power markets across the Netherlands, Belgium and the UK.
The Power NL Day-Ahead auction recorded 44.5 TWh, slightly down from the previous year. The volumes traded on the Dutch Intraday exceeded the 2013 volume by 41% and reported a total of 1.0 TWh with a total of 34,464 trades registered.
The Belpex markets saw healthy growth in 2014 and reached record volumes. The volumes traded on the Day-Ahead auction experienced continuous growth throughout the year and reached a total of 19.8 TWh traded, up by 15% from 2013. A record high 786 GWh was traded on the Belpex Continuous Intraday market, exceeding the previous year’s volumes by 19%. 23,172 trades were registered on the Belpex Intraday market.
The Power UK market also experienced its most successful year ever. The Continuous Intraday market experienced a slight increase in volumes with a total of 14.5 TWh traded with 544,155 trades on the market. The Day-Ahead auction reached a record high 11.6 TWh traded in 2014, exceeding the previous year’s volume by 35%.
81 GWh was registered for Power UK OTC Bilateral clearing, up by 37% from 2013.
The number of memberships across the APX markets continued its growth in 2014, indicating the ever growing interest for and confidence in the markets and products offered by APX. The Power NL, Power UK and Belpex markets all welcomed new members during the year. The combined number of memberships went up to record high 181 by the end of the year, up from 165 from the previous year.
The APX Power NL market had 63 members, Power UK 70 members and Belpex 48 members at the end of 2014.
Market Developments and New Initiatives
APX shares the European vision for the realisation of a single, integrated market. APX has for many years been the frontrunner in European market integration and 2014 saw significant progress towards this goal. APX, together with its exchange partners and TSOs, successfully launched North-West European price coupling in February 2014, followed by extension to South-West Europe in May. The combined region, now called Multi-Regional Coupling (MRC), covers 17 countries and it is based on a common Day-Ahead price calculation using the Price Coupling of Regions (PCR) systems developed and operated by a number of power exchanges, including APX.
The adoption of PCR allowed APX to extend its existing product offering. Smart products, exclusive groups and linked block orders, were introduced on all the APX markets simultaneously with the launch of NWE market coupling. Smart products make it easier for members to reflect the physical nature of their portfolios into the Day-Ahead auction and offers additional opportunities with respect to active demand side management.
Significant progress on the CWE Flow-Based market coupling project has been accomplished in 2014. Flow-Based market coupling is expected to replace the existing ATC market coupling mechanism in the spring of this year. The Cross-Border Intraday project, to implement a continuously traded market across Europe, has made important progress, and APX and its project partners are looking to close the design phase shortly and commence implementation of the common system.
These projects remain among APX’s highest priorities.
To ensure generation adequacy in preparation for the winter 2014-2105, Belpex has, upon request of Elia, developed the mechanism that is operated through a new dedicated market segment, the Strategic Reserves Market. Belpex has a driving role in the activation of the Belgian strategic reserves as one of the triggers for Elia to use strategic reserves is a situation in which a total demand for electricity on the Belpex DAM exceeds the total available offer. These circumstances did not occur during 2014 and therefore the Strategic Reserves Market was not activated during the year.
Spot Indices and CWE Price Convergence in 2014
During 2014, the Dutch power index for the Day-Ahead Market, APX NL DAM Index, had an average hourly price of €41.18/MWh. Belix, the index for the Belpex Day-Ahead Market, had an average price of €40.79/MWh. The UK power index for the Day-Ahead Market, UKPX Auction Base Index, had an average price of £42.02/MWh.
During 2014, the entire CWE region had full price convergence for approximately 19% of the time. The Dutch price converged with the German price 29% and with the Belgian price 78% of the time. The Belgian price was converging with the French price 46% of the time.