ET Part 1 - Basic Objects

• beides sind verbindliche Terminkontrakte
• -> Verpflichtung zur Lieferung/Kauf

Futures werden börslich gehandelt und haben feste Vertragsparameter

Forwards werden nicht börslich gehandelt, sondern OTC und sind individueller

• Delta ist einer der „Griechen“
• “Das Verhältnis der Änderung des Optionspreises zur Änderung des zugrundeliegenden Aktienkurses“
• -> Anzahl der Aktien, die wir für jede Shor-Position halten müssen, um ein risikoloses Portfolio zu bilden

• PP owner can always choose between producing and selling electricity or buying it for cheaper on the market
• they create demand & supply

• trading in power, natural gas and CO₂ emission rights
• power day-ahead auctions (24/7)
• 24h of the respective next day can be traded in 1h-intervals or block orders (Baseload 1-24, Peakload 9-20, Night 1-6, Rush Hour 17-20, Business 9-16)
• continuous power intraday trading until 75min before delivery, delivery on the same/next day in single hours/blocks
• participants submit their price offer/bid curves
• ↳ EEX system prices are equilibrium prices
• EEX day prices = average of 24 single hours

• 24/7 auctions
• 24h of the respective day in 1h-blocks/intervalls

Continuous trading until 75min before delivering in single hours/blocks

• price seems to hover around instead of clearly rising/falling:
• ->no clear Drift, more like a constant movement
• ->longterm equilibrium in the market (needs have to be satisfied longterm)
• -> ups/downs due to shortage/transport problems/overproduction
• -> extreme spikes due to non-storability of electricity
• —>electricity demand is rather inelastic while supply is going down: demand will react to shortages with high jumps (no flexibility)
• negative prices: grid security, non-storability and unflexibility of PPs while short times of low demand costs
• after financial crisis: rise of renewables lead to fewer spikes (renewable energy law changed priority in the market = REs eating profitable lunchtime hours due to zero marginal costs)

• not storable
• homogeneous
• different production ways
• production on demand
• high demand fluctuation
• no short-term electricity in demand
• high price volatility due to renewables in-feed

A centralised platform where participants can exchange electricity transparently according to the price they are will ti pay/receive and according to the capacity of the electrical network.

• Participants submit sell/buy orders for several areas&hours
• submissions are closed at a pre-specified time (closure)
• market is cleared
• —> day-ahead

• Participants continuously submit orders, orders are stored
• Each time a deal is feasible, it‘s executed
• —> intra-day

• Future contracts for GER & FRA with delivery periods: week, month, quarter, year
• GER: single days and weekends
• European style options on futures

• Auction day-ahead and continuous intra-day market
• products are individual hours, baseload, peakload, blocks of continuous hours
• Intraday market is open 24/7 and products can be traded until 30mins before delivery
• GER 15min contracts possible

• correct longterm production schedule
• sell expensive and buy cheap hours for flexible PPs
• adjust residual load profiles
• renewables can not sell averages due to intermittent production (long term)

trading (quarter) hours until 30min before start of period; continuously during the day

• Motivation for trading intraday:
• ⇾ correct/optimise the day-ahead position
• ⇾ optimise PP usage
•     ↳generator can run their PP or buy electricity if cheaper
• customer can optimise their demand
• renewables can react to changes in the forecast
• balancing quarter-hour ramps with quarter-hour contracts (buy while starting and sell if overproduction occurs)