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Over the next five years, the European Energy Exchange AG (EEX) will focus its efforts in order to become the clear leader among European exchanges on the basis of its own strength. The strategy will see EEX concentrating on organic growth, without using additional funds from its shareholders and without cut-backs in the annual results. The partnership model will be maintained and expanded only if it is commercially sensible and viable.
This five-year aim is to be achieved through a reinforced expansion of EEX’s position in the four main strategic directions – power, natural gas, emissions and clearing. Outlining the future of the EEX Group, Dr. Hans-Bernd Menzel, CEO of EEX, said: “As regards to the perspective for 2015, our markets in the power segment will constitute the clear reference markets throughout Europe. In the field of natural gas we set out to provide the leading trading platform in Continental Europe as well as establishing the reference price in this segment. As a pioneer in the field of security standards, transparency and reliability we will be a central European market for emission allowances, with particular focus on the primary market auction from 2013 onwards. And, finally, ECC, our clearing subsidiary, will be the leading provider of energy and crosscommodity clearing in Europe“.
EEX has established a good position for itself with regard to this aim in a European market structure in which there are few large, professionalised exchanges and a multitude of local exchanges with a limited product range. “We have really done our homework in this field and established the basis for the next steps“, Dr. Christoph Mura, member of the Executive Board and Chief Operating Officer of EEX, explained, pointing to the improvement of the trading participants‘ connection to the EEX systems, the successful further development of products and services and the increase in liquidity on the individual markets. Regarding the introduction of the European electricity index ELIX and the upcoming launch of the new gas price index which is scheduled for the end of January 2011 and will reflect the market price for natural gas on the German trading market, Dr. Mura added: “In the recent past we have, in particular, established standards which give us a head start in becoming the European standard ourselves“.
Today the European Energy Exchange and its clearing subsidiary, European Commodity Clearing AG (ECC), cover a fundamental part of Continental European energy trading. The co-operation with the French Powernext has created a centre of gravity for power trading and implemented an outstanding example of market harmonisation. “EEX and EPEX Spot integrate markets”, CEO Menzel explained, going on to describe his understanding of the situation regarding market integration in Europe. “Even though market coupling is successful, it is only one step - and certainly not the last one – on the way towards an integrated European market.“
EEX’s current position is substantiated by a positive development of business during the financial year 2010. Iris Weidinger, EEX Chief Financial Officer, commented: “Compared with the previous year EEX will achieve increases in trading volumes and revenues on all markets“. The Power Derivatives Market, which is expected to increase revenues by 12 percent compared to 2009, constitutes the most important market for EEX. In this context, the share of the exchange transactions on the Derivatives Market has increased considerably. According to indicative information, sales revenue in the field of natural gas is expected to increase almost threefold with growth on the Spot Market more pronounced than on the Derivatives Market. In the field of emissions trading EEX will double its sales revenue compared with the previous year. Moreover, the market share on the EUA futures market was expanded. Due to marketing of energy generated from renewable sources in Germany, the sales revenue on the EPEX Power Spot Market, which contributes to EEX revenues in the form of clearing fees, will be considerably higher than during the previous year.
For the financial year ending on 31 December 2010 EEX expects sales revenue of more than EUR 40 million and pre-tax profits of approximately EUR 16 million. On the basis of this sound initial position, and assuming macro-economic conditions do not deteriorate again drastically, EEX projects to double its sales revenue by the year 2015 with a significant increase in profit due to economies of scale.
