Download - Central European Gas Hub ERGEG 30th, 2009
Central European Gas HubCentral European Gas Hub
ERGEG 30th, 2009ERGEG 30th, 2009
How to serve commodity trading
3000 BC
1200 AD
2000 AD
1700 AD
140 000 BC 100 AD
First documented Trading took place in Africa
Trading along the Amber Road
Trading along the Silk Road
Trading along the Hanse Route
PHYSICAL & VIRTUAL TRADING
DEVELOPMENT OF COMMODITY HUBS
1994 AD NBP Gas Hub
1999 AD APX Gas Hub
2005 AD CEGH Gas Hub
2003 AD TTF Gas Hub
1602 AD Exchange in Amsterdam & First Share
1720 AD First Crash
1771 AD Exchange in Vienna
1792 AD Exchange in New York
1200 AD Trading along the Hanse Route
140000 BC First documented Trading
3000 BC Trading along the Amber Road
100 AD Trading along the Silk Road
1409 AD First Exchange in Brugge
1540 AD Exchange in Nürnberg
1554 AD Exchange in London
PHYSICAL TRADING
Hanse - Success
CEGH: one additional trading point
HUB landscape in Europe
CEGHCEGHCEGHCEGH
GUD
TTF
NBPZeebrug
ge
EGT
PEG
PSV
Future potential Hubs
DONG
CDG
Almost 100% of respondents are
currently trading at the
CEGH Hub in Baumgarten:
When it comes to volume of trade, 57% of traders said that the CEGH has the best chance of becoming the most important hub in CEE/SEE and would be best suited as regional trading platform.
Furthermore 75% of respondents would like to have a regional price index where one would be technically and economically viable.
0
10
20
30
40
50
60
70
80
90
100
CEGH PSV EEX (BEB) EEX (EGT)
% t
rad
ers
usa
ge
of
hu
bs
PricewaterhouseCoopers: ordered by ERGEG in the course of the SEE Region Initiative
CEGH - Monthly Title Tracking - Volume
0
500
1.000
1.500
2.000
2.500
10/2
005
11/2
005
12/2
005
01/2
006
02/2
006
03/2
006
04/2
006
05/2
006
06/2
006
07/2
006
08/2
006
09/2
006
10/2
006
11/2
006
12/2
006
01/2
007
02/2
007
03/2
007
04/2
007
05/2
007
06/2
007
07/2
007
08/2
007
09/2
007
10/2
007
11/2
007
12/2
007
01/2
008
02/2
008
03/2
008
04/2
008
05/2
008
06/2
008
07/2
008
08/2
008
09/2
008
10/2
008
11/2
008
12/2
008
Mio
. m³
Development of OTC - Trade
Increasing trading activities:• Increasing churn rate
• Increasing number of customers
• Increasing number of nominations
Number of registered and active customers at CEGH
0102030405060708090
10/2
005
11/2
005
12/2
005
01/2
006
02/2
006
03/2
006
04/2
006
05/2
006
06/2
006
07/2
006
08/2
006
09/2
006
10/2
006
11/2
006
12/2
006
01/2
007
02/2
007
03/2
007
04/2
007
05/2
007
06/2
007
07/2
007
08/2
007
09/2
007
10/2
007
11/2
007
12/2
007
01/2
008
02/2
008
03/2
008
04/2
008
05/2
008
06/2
008
07/2
008
08/2
008
09/2
008
10/2
008
11/2
008
12/2
008
Cus
tom
ers
Active customers - CEGH
Registered customers - CEGH
CEGH - Churn Rate
1,0
1,5
2,0
2,5
3,0
3,5
10/2
005
11/2
005
12/2
005
01/2
006
02/2
006
03/2
006
04/2
006
05/2
006
06/2
006
07/2
006
08/2
006
09/2
006
10/2
006
11/2
006
12/2
006
01/2
007
02/2
007
03/2
007
04/2
007
05/2
007
06/2
007
07/2
007
08/2
007
09/2
007
10/2
007
11/2
007
12/2
007
01/2
008
02/2
008
03/2
008
04/2
008
05/2
008
06/2
008
07/2
008
08/2
008
09/2
008
10/2
008
11/2
008
12/2
008
Basic nominations per gas day
0
100
200
300
400
500
600
700
800
900
1000
20
06
.01
20
06
.03
20
06
.05
20
06
.07
20
06
.09
20
06
.11
20
07
.01
20
07
.03
20
07
.05
20
07
.07
20
07
.09
20
07
.11
20
08
.01
20
08
.03
20
08
.05
20
08
.07
20
08
.09
20
08
.11
20
09
.01
No
min
ati
on
s /
da
y
Appr. 2000 nominations per day
Herfindahl Index
Verlauf Herfindahl Index CEGH
0,0000
0,0500
0,1000
0,1500
0,2000
0,2500
0,3000
0,3500
0,4000
0,4500
0,5000
0,5500
0,6000
2006
/07
2006
/08
2006
/09
2006
/10
2006
/11
2006
/12
2007
/01
2007
/02
2007
/03
2007
/04
2007
/05
2007
/06
2007
/07
2007
/08
2007
/09
2007
/10
2007
/11
2007
/12
2008
/01
2008
/02
2008
/03
2008
/04
2008
/05
2008
/06
2008
/07
2008
/08
2008
/09
2008
/10
2008
/11
2008
/12
Monat
Herfindahl Index
Herfindahl Index Trendline
Broker based trading at CEGH
0
50
100
150
200
250
300
350
08.05.2007 16.08.2007 24.11.2007 03.03.2008 11.06.2008 19.09.2008
MW
h/h
Dimensions of bubbles are indicating volume of trade
PSV
ICAP-Baumgarten Fronth Month
0
10
20
30
40
01
.05
.20
08
01
.06
.20
08
01
.07
.20
08
01
.08
.20
08
01
.09
.20
08
01
.10
.20
08
01
.11
.20
08
01
.12
.20
08
01
.01
.20
09
EU
R /
MW
h
ICAP Baumgarten OTCICAP BMGT Front Month - BidICAP BMGT Front Month - AskBMGT Heren-WeeklyICAP BMGT Front Month - Bid-Ask SpreadItalian PSV Front Month
Bid – Ask spread
0
10
20
30
40
01
.05
.20
08
01
.06
.20
08
01
.07
.20
08
01
.08
.20
08
01
.09
.20
08
01
.10
.20
08
01
.11
.20
08
01
.12
.20
08
01
.01
.20
09
Price quotations in Baumgarten are reflecting the market
environment
OTC Market Making - Baumgarten
• Products:
• Day Ahead
• BOM
• 2-3 Front months
• 2 Quarters
• 2 Seasons
• 1 Yearly contract
• Quantities:
• 10 / 30 MWh/h
• Bid/Ask Spread:
• Maximum: 1,0 EUR / MWh (1,5 for seasons/ yearly contracts)
Development from the physical to the financial services
Serv
ices
2006 2007 2008 2009
Title tracking service
Spot
Futures
Backup / back down service
OTC Clearing
CEGH Multi Trading (CMT) / Dispatching services/Allocation/Invoicing
Physical Balancing Merit order list
Wheeling service
No notice storage service
Web based online gas auctioning
Online bulletin board
Physical balancing via online bulletin board
CEGH Multi Trading (CMT) Dispatching
Exchange project: CEGH - WBAG
Shareholder agreement11/ 2008
Contractual setup11/ 2008
Approval FMA (basic concept)11/ 2008
Pre notification submitted 12/ 2008
Evaluation of IT – Systems 2008
Selection IT – Systems 11/ 2008
Operation agreements
Customer agreementsInterface implementation
OTC dispatching
IT implementation
IT interfaces to WBAG
IT integration customer
Simulation start
Go life 2009
technical legal
AG foundation10/ 2008
GAS EXCHANGE- Spot Trading
- Futures Trading
TRADING
Exchange Trader
Exchange Trader
z.B. Bank Austria
z.B. EconGas, RAG, StGW, Essent Energy Trading, …
OMX System
[€/MWh]
CLEARING & SETTLEMENT
(RISK MANAGEMENT)
Physical Trade - OTC
EXCHANGE TRADING
OTC TRADING
CCP.ACentral
CounterpartyAustria
OeKBSettlementbank
General Clearing Member (GCM)
Non Clearing Member (NCM)
Direct Clearing Member (DCM)
Non Clearing Member (NCM)Non Clearing
Member (NCM)Non Clearing Member (NCM)
Remote Member
Clearing Agent (Bank)
Exchange Trader 1
Exchange Trader 2
€
t
€
t
Day of Delivery -1
Supply & Demand
GasExchange
GAS EXCHANGE- Spot Trading
- Futures Trading
TRADING
Exchange Trader
Exchange Trader
z.B. Bank Austria
z.B. EconGas, RAG, StGW, Essent Energy Trading, …
OMX System
[€/MWh]
CLEARING & SETTLEMENT
(RISK MANAGEMENT)
Physical Transfer - OTC
EXCHANGE TRADING
OTC Transfers
CCP.ACentral
CounterpartyAustria
OeKBSettlementbank
General Clearing Member (GCM)
Non Clearing Member (NCM)
Direct Clearing Member (DCM)
Non Clearing Member (NCM)Non Clearing
Member (NCM)Non Clearing Member (NCM)
Remote Member
Clearing Agent (Bank)
Exchange Trader 1
Exchange Trader 2
€
t
€
t
Day of Delivery -1
Supply & Demand
Contractual frameworks
WAG 2007: Wertpapier Aufsichtsgesetz
Börsegesetz (exchange law)
CEBS Committee of European Banking Supervisors
MiFID Market Infinancial Instrument Directive
Ministry of finance
Department of commerce
Derivative market
Spot market
OTC marketEnergie – Control GmbH
Interconnection Agreement (OBA)
Austrian Financial Markets Supervisory Agency
Three pillars for liquidity
ExchangeOTC
Capacity utilization
Trading
platform
Storage
Use it or lose it interruptible
Flexible services
Harmonized Environment
Sufficient primary capacities
Bricks for Hub construction
Back up/ down in cooperation with
EFET
IT in place legal
Interconnection agreement / OBA
Partnership with GAZPROM, VSE, CENTREX prenotified to DG - Comp
FirmnessStandard-
isation LiquidityTrans-
parency
Gas exchange
Market maker in OTC trade in cooperation
with ICAP
Cooperation with HEREN
& EFET
Thank you for your attention