OM To Launch First UK Electricity Futures Market

The UK Power Exchange, OM's electricity market for the UK today announced that it will create the UK's first electricity futures market from May 2000. This follows OM's announcement in June 1999, that it would create UK's first Power Exchange, to be known as UKPX. The inclusion of the Utility Reform Bill in yesterday's Queen Speech provides for the reform of the Electricity Pool in which wholesale electricity is currently traded. This revised electricity market will create a demand for both the development of a power exchange, or electricity spot market, and also a futures market. From May 2000, it will be possible to trade on the futures market for the delivery of electricity from October 2000 and beyond, the date the Government has set for the reform of the Electricity Pool. UKPX's monthly futures contracts will be designed to cascade into week and day futures contracts and finally into half-hour spot contracts. The futures and spot markets will enable improved planning for electricity buyers and sellers and allow greater long-term price transparency. The market will be screen-based, anonymous and fully cleared, thereby creating a competitive, visible and secure trading environment. Announcing the futures market, Peter Cox, Chief Executive of the OM London Exchange said "Since our announcement of the creation of the UKPX, we have continued to consult widely within the electricity industry. This consultation revealed substantial demand for UKPX to launch futures contracts ahead of October 2000 when the spot market will commence trading. OM has substantial experience in operating exchanges and clearing houses and in the development of power exchanges, and we believe the UK offers huge potential in this area" Participation in UKPX will be open to utility companies, energy retailers, generators, municipalities, industrial companies and the financial community. Anonymity and non-discriminatory access to the market will safeguard members' full and fair participation in the market. OM operates exchanges in London (the OM London Exchange, which is a Recognised Investment Exchange in the UK) and Stockholm. OM Technology is the world's leading provider of exchange technology with customers all over the world, e.g. the California Power Exchange, the Nordic electricity exchange Nord Pool, the Finnish electricity exchange EL-EX, the Australian Stock Exchange, the American Stock Exchange and the Toronto Stock Exchange. The parent company of the OM Group, OM Gruppen, is listed on the OM Stockholm Exchange.