The proposed Options offering will take place in 2 phases. Quarter 1 Options contracts on the d-cypha SFE Australian Electricity Futures contracts form phase one of the offering and will be listed on 5th December 2003.
The second phase of the offering is comprised of Options on Calendar and Financial Year Strip Futures Products and, Calendar and Financial Year $100 Caps and $300 Caps, and will be listed on the SFE in early 2004.
Details of the new offering have been presented to the majority of market participants over the last few weeks.
Dr Ralph Craven, Chairman of d-cypha Limited and CEO of Transpower NZ said, "Consistent with d-cyphaTrade's commitment to developing the electricity market and encouraged by the success of the Electricity Futures Contracts, d-cyphaTrade is now well-positioned to successfully deliver Options to the Australian market."
The Australian energy derivatives markets have developed significantly in the past year in a number of respects. Exchange-traded options will further enhance that development process by alleviating many of the credit issues currently prevalent in the OTC Options market.
Ken Chapman, SFE General Manager - Strategy, says "the ability of participants to reduce the cost of credit in the market highlights the significant added value that arises from using futures to hedge market (pricing) risk".
d-cyphaTrade is confident that the addition of exchange-traded options will encourage large energy end-users to incorporate electricity financial instruments into their overall risk management strategies.
As d-cyphaTrade enters its second year of operation, the business is pleased to announce that it has been collaborating with the department of Industry Tourism and Resources to develop a Wholesale Electricity Price Index (WEPI™) for the Australian electricity market which will be calculated and published on a daily basis. This is an exciting development for d-cyphaTrade, and for the entire NEM.
"With our underlying philosophy of removing barriers to trade, it is our intention to continue working closely with all market participants to facilitate the growth and development of a vibrant and liquid electricity derivatives market in Australia." Dr Craven said.
