May 2013

Norwegian salmon gets indexed on NOS

Earth Day tracked on UW microsite

WSJ speaks Turkish now

ISE Gemini new options exchange

Coordination of Gas and Electric Industries: Increasing Transparency?

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May 2013

datawatch Summary
p. 3
FX, Interest Rates, Credit, and Equity Indexes p. 14 - 15 ICE Launches Four New Credit Index Futures ICE Launches Russell 2000 Growth and Value Index Futures NYSE Liffe Adds Equity Options on NSI N.V. NYSE Euronext Launches SME Marketplace STOXX and Eurex Repo Launch GC Pooling Indexes Tradition Launches ParFX Trading Platform Markit Announces Markit iBoxx US Non-Agency RMBS Indices Montral Exchange Launches Futures on Trading Simulator S&P Dow Jones Indices Licensed CDCC to Clear OTC Options Other Matters Wall Street Journal Launches Turkish Website Markits Portfolio Valuations Service Has New Risk Tools NYSE: Consolidated Feed for Level 1 Market Data Xetra Launches New State Street Bond Index ETF Markit Acquires a DTCCs Stake in MarkitSERV Markit Launches European Commission Management Platform ISE Presents New Options Exchange, ISE Gemini HKEx Announces OTC Clears New Founding Shareholders NASDAQ OMX Introduces Pre-Trade Risk Management Tools NYSE Liffe Welcomes KGI Futures as Newest Member Wall Street Journal Launches Moneybeat Blog Chi-X Canada Announces Pricing Schedule for CX2 IIRC Presents International Integrated Reporting Framework NASDAQ OMX Completes Acquisition of 25% Stake in TOM Eurex Deepens Dialogue with China HKEx and Anhui Financial Services Sign MOU HKEx and Chongqing Financial Services Sign MOU Clearstream and Standard Chartered: a Global Liquidity Hub ZEMA Market Dashboard p. 19 - 20 p. 16 - 18

Editorial

Since the 1970s, the U.S. energy independence has been a transferable torch to be carried by different political leaders from different political parties. This torch has led the bearers, either the elected presidents or just those in the making, to bright outcomes by solidifying their success. The independence, though, has yet to be achieved. Throughout the length of the long and winding road of the United States history of seeking an elusive energy independence, the only thing that has remained unchanged is the goal of reducing the imports of oil; all other parameters and drivers in this crusade have been revised, updated, supplemented or recycled.

Data News
Power Markets NASDAQ OMX Launches European Price Area Contracts NASDAQ OMX: Finnish and Swedish Week Contracts for Difference ICE Futures Europe Launches UK Electricity Futures Fossil Fuel Markets

p. 4 - 20
p. 4

p. 5 - 10

ICE Futures Europe Launches UK Natural Gas Futures ICE Launches Six North American Natural Gas Futures ICE Launches New Natural Gas Liquids Future ICE Launches Eight New Freight Average Price Options ICE Launches Four Crude Contracts for Brent and Dubai CME Group Adds New Fuels Futures CME Group to List Natural Gas Variance Futures NASDAQ OMX Launches Freight and Fuel Oil Futures and Options ICE Launches Gasoline and Distillates Contracts Platts Launches eWindow for European Propane Derivatives Platts Launches Price Assessment for Calcined Petroleum Coke Platts Introduces New OSPs for Nigerian Crude Platts Proposes USGC UL SHO Assessment NASDAQ OMX Launches Block Trades for Freight and Fuel Oil Platts to Discontinue Certain Dirty Tanker Rate Assessments Platts to Cease Assessments for FD NWE and FOB Rotterdam Styrene Platts Discontinues Shell Canada Crude Price Postings Platts Cease USAC Supplemental Gasoline Assessments Platts CFR Korea isomer-MX Assessments Postponed Platts to Refine European Steam Cracker Margin Model Platts Aligns NWE Benzene Forward Curve Month Roll Platts Updates Global Crude Pages in PGA Platts Aligns Timing Guidelines for European Propane Derivatives Platts Publishes AZRBOB Reflecting 5.7 RVP Platts Postpones Discontinuation of NWE T1 Methanol Assessments Platts Updates USGC Naphtha Specifications Platts to Update Crude Oil Marketwire Platts to Relocate Third-Party Oil Data in Database Platts to Relocate Certain Asia Crude Data Platts to Relocate Certain Feeder Crude Data in Database Platts to Relocate Certain US Crude Data in Database ICE Futures Europe Postpones Introduction of Additional Options New NGX CPA Amendments CME Changes Strike Prices for Henry Hub Financial Option Agriculture, Forestry and Metal Markets p. 11 - 12

Actual Weather (AccuWeather) North American Electricity Natural Gas Prices Crude Oil Prices

News from Data Vendors

p. 21 - 25

New Data Reports for ZEMA Argus Adds Ethanol Assessment for India Argus Steel Feedstocks Argus Introduces Global Iron Ore Price Assessments Argus DeWitt Fuels and Octane Services Argus/HIS McCloskey Launches API 10 Coal Assessment for Colombia EPEX Spot: European Market Coupling Tests Begin Carbon Market World ETS Database Updates MDA Offers Power WxDesk for Weather, Load and Price Forecasting EEX-Powernext Gas Cooperation: PEGAS Launched Successfully OTC Global Holdings: Choice Natural Gas Hires Nicholas Ernst as Director of Weather Markets

NCDEX Introduces e-mandis ICAP Expands Soft Commodities Group NOS Launches NASDAQ Salmon Index CME Group Adds Iron Ore 62% Fe and CFR China DCE to Start Egg Futures Trading ICE Launches New Iron Ore Future Platts Ceases Weekly Japan and China Molybdenum Assessments CME Integrates with Kansas City Board of Trade Platts Extends Consultation Period on Iron Ore Lump Platts Clarifies Assessment for North American Lead Environmental Markets and Weather Services p. 13

In Depth

p. 26 - 33

Coordination of Gas and Electric Industries: Increasing Transperancy? Over the last decade, the electric power industry has been on an unprecedented rollercoaster ride throughout a whirlwind of market ups and downs, regulatory twists and turns, and environmental swings. Compounding all these strains is an unprecedented growth in natural gas-fired generation that is leading us towards something completely new and almost revolutionary: the coordination and possible integration of both the natural gas and electric systems.

ICE Launches Three North American Environmental Futures Weather Underground Introduce Earth Day Microsite AccuWeather Adds Seven New Apps to StoryTeller System AccuWeather Traffic App Includes Traffic News and Driver Data Final Date of ICE EUA Phase 2 Trading NOAA Updates Chemical Reactivity Worksheet Software

May 2013

datawatch Editors letter

Since the 1970s, the U.S. energy independence has been a transferable torch to be carried by different political leaders from different political parties. This torch has led the bearers, either the elected presidents or just those in the making, to bright outcomes by solidifying their success. The independence, though, has yet to be achieved. Throughout the length of the long and winding road of the United States history of seeking an elusive energy independence, the only thing that has remained unchanged is the goal of reducing the imports of oil; all other parameters and drivers in this crusade have been revised, updated, supplemented or recycled. The definition of independence has been revised throughout time. At some point, the ideal of independence was viewed as an independence from all foreign sources of energy. At other points, the ideal was to be independent from the politically unstable Middle East as the main source of energy imports. The ideal set of resources to replace the imported oil has been revised as well. At the start, the focus was on expanding domestic renewable generation (the first time the expansion of renewables was promoted was by the Public Utilities Regulatory Act of 1978) and increased efficiency in the usage of fossil fuels. This Act also forced monopolistic electric utilities to buy electric power from independent power producers that built the renewable-resources generators. It really did not work well. As it turned out, it was difficult to persuade investors to build power generators of a certain type and, rather expensive in this particular case in the absence of a free market supported by unbundled generation and transmission systems. The issue of developing a competitive marketplace for the power industry by separating two major lines of operations, generation and transmission, was solved in the 1990s; however, by then, the energy independence slogans had already faded away. Back to the 70s, the energy independence also was looked at through the prism of developing domestic oil resources. Untapping the largest U.S. oil reserve, incidentally located in the Arctic National Wildlife Refuge, stirred up a nation-wide public discussion on whether the preserved nature lands should be open for drilling. The discussion led to an expected, but unfruitful, conclusion the impact on wildlife is dramatic and the oil recovery solution is only incremental. After seemingly fizzling out for several decades, the torchs search for the universal solution has flamed to life again, popping up on political banners since the 2000s. Repeating the same cycle of the 70s, the push started for renewable generation supplemented by programs on increasing efficiency and diluting fossil fuels with vegetable oil in the form of biodiesel, ethanol fuel, and others. Recently, the burning question of achieving the energy self-sufficiency has turned back to exploration of domestic fossil fuels this time from shale deposits. And only to confuse investors further, the underlying definition of energy independence is being tested again: Is the energy independence ideal the independence from the regions with the unstable political environment or just any region across the U.S. border? This has huge consequence for the Canadian Keystone XL pipeline project. This project has been seen by some as a means of relieving the pressure off of Canada and the United States from the OPEC countries. After being approved by the House on May 22, 2013, the project now faces threats from the White House to be vetoed. Those who oppose the White Houses stand on it are wondering whether the reduction of oil imports now applies to the oil from the Middle East only or the globe as a whole (since Canada has not particularly been on the list of the hostile oil importers)? On the other side of the argument are those that see the reduction of imports from the Middle East (bringing declining economic conditions) as only accelerating and fueling up an already unstable political environment in the region. According to this position, the U.S. should maintain the present trading balance to ensure world peace. No doubt, most heated discussions about this energy independence torch are centered around environmental factors. For example, dirty and sandy Alberta oil that is expected to be refined at U.S. refineries may have a negative effect on the air quality, discarding the so-much-longed for reductions in GHG emissions. Meanwhile, the Alaskan government has just released, The Oil and Gas Resource Evaluation & Exploration Proposal for the Arctic National Wildlife Refuge 1002 Area, where the state authorities are attempting to push the U.S. Congress to authorize development of the regional resources. The reaction to this initiative will be a good indicator of how critical the environmental concerns are in the decisions on such projects and if this torch will continue to keep aflame.

Olga Gorstenko

Editor

Olga Gorstenko Phone: 778-296-4183 Email: olga@ze.com

Advertising & Vendor Relationships

Bruce Colquhoun Phone: 604-790-3299 Email: bruce.c@ze.com

ZEMA Suite Inquiries

Bruce Colquhoun Phone: 604-790-3299 Email: bruce.c@ze.com

Have an idea for an article or would like to contribute to an upcoming issue? Write to us at datawatch@ze.com To access previous issues of ZE DataWatch, go to datawatch.ze.com

datawatch May 2013 NASDAQ OMX Launches European Price Area Contracts
On April 16, 2013, NASDAQ OMX Commodities launched a new suite of monthly, quarterly, and yearly Contracts for Difference (CfD) contracts, including both Forwards and Futures. The CfD enables traders from Continental European power markets to hedge the basis risk between the German system price and neighboring price areas by trading the relevant CfD. Initially, contracts are listed for the Czech, Dutch, French, and Belgian markets. For each area, there will be three monthly, three quarterly, and two yearly contracts available. For each market, there are three monthly, three quarterly, and two yearly contracts available.

Power Markets

ICE Futures Europe Launches UK Electricity Futures

On April 29, 2013, ICE Futures Europe launched the following contracts upon completion of relevant regulatory processes: ICE Code UPL UBL Description ICE UK Peak Electricity Future (Gregorian) ICE UK Base Electricity Future (Gregorian)

For UPL contract specifications, click here For UBL contract specifications, click here

NASDAQ OMX: Finnish and Swedish Week Contracts for Difference

On April 16, 2013, the NASDAQ OMX Group, Inc. announced the introduction of Finnish and Swedish Week Contracts for Difference (CfD) contracts, subject to successful testing and regulatory approval. The Finnish price area (HEL) and Swedish price areas (MAL, STO, SUN, LUL) Forward CfD curves will now cover five weekly, four monthly, four quarterly and four yearly contracts. The product calendar will be updated to reflect the launch of these products in due course.

Back to Summary

datawatch May 2013 ICE Futures Europe Launches UK Natural Gas Futures
On April 29, 2013, ICE Futures Europe launched the following contracts upon completion of relevant regulatory processes: ICE Code GWE GWM Description ICE UK Natural Gas (EUR/MWh) Future ICE UK Natural Gas Daily Future

Fossil Fuel Markets

ICE Launches Four Crude Contracts for Brent and Dubai

On April 29, 2013, ICE introduced four new crude oil futures and options contracts, listed below: ICE Code BRX BRX PDB DBI Description Brent 6-Month Calendar Spread Bullet Future Brent 6-Month Calendar Spread Option Dated Brent (Platts) Average Price Option Dubai 1st Line (Platts) Average Price Option

For GWE contract specifications, click here For GWM contract specifications, click here

Shown below is a comparison of prices and volumes for ICEs existing day-ahead natural gas contracts.

ICE Launches Six North American Natural Gas Futures

On April 29, 2013, ICE Futures U.S. introduced six North American natural gas futures contracts, listed below: ICE Code IRB IZB IRS IZS IRI IZI Description Iroquois (Into) Basis (Platts) Future Iroquois-Z2 Basis (Platts) Future Iroquois (Into) Swing (Platts) Future Iroquois-Z2 Swing (Platts) Future Iroquois (Into) Index (Platts) Future Iroquois-Z2 Index (Platts) Future

Data Source: ICE*

For contract specifications, please click on the description links.

ICE Launches New Natural Gas Liquids Future

On April 29, 2013, ICE introduced a new natural gas liquids futures contract, listed below: ICE Code Description TOT Propane, OPIS CIF ARA ToT Cargoes Future

CME Group Adds New Fuels Futures

On May 11, 2013, CME Group listed nine new futures for Biodiesel RINS (Argus), Advanced Biofuel RINS (Argus) and Ethanol RINS (Argus) for 2012, 2013, and 2014. All contracts follow Argus pricing for the Renewable Identification Number specified by product type and RIN Vintage for all three years. The trading venues are CME Globex, CME ClearPort, and NYMEX Trading Floor. These contracts are listed with, and subject to, the rules and regulations of NYMEX. CME Code D42 D43 D44 D52 D53 D54 D62 D63 D64 Description Biodiesel RINS (Argus) 2012 Futures Biodiesel RINS (Argus) 2013 Futures Biodiesel RINS (Argus) 2014 Futures Advanced Biofuel RINS (Argus) 2012 Futures Advanced Biofuel RINS (Argus) 2013 Futures Advanced Biofuel RINS (Argus) 2014 Futures Ethanol RINS (Argus) 2012 Futures Ethanol RINS (Argus) 2013 Futures Ethanol RINS (Argus) 2014 Futures

ICE Launches Eight New Freight Average Price Options

On April 29, 2013, ICE introduced eight new freight average options contracts, listed below: ICE Code WNU WSJ WMJ WSL WCN WGJ WAU WNC Description TC2 FFA-Northwest Europe to USAC (Baltic) APO TC4 FFA-Singapore to Japan (Platts) APO TC5 FFA-Arabian Gulf to Japan (Platts) APO TC6 FFA-Skikda to Lavera (Cross Med) (Baltic) APO TC14 FFA-USGC to Continent (Baltic) APO TD3 FFA-Arabian Gulf to Japan (Baltic) APO TD5 FFA-West Africa to USAC (Baltic) APO TD7 FFA-UK North Sea to Continent (Baltic) APO

For Biodiesel RINS (Argus) 2013 Future contracts, click here For Advanced Biofuel RINS (Argus) 2013 Futures, click here For Ethanol RINS (Argus) 2013 Futures, click here

*Graph created with ZEMA

Back to Summary

datawatch May 2013 CME Group to List Natural Gas Variance Futures
On April 29, 2013, CME Group announced the listing of three new Natural Gas Variance Futures. CME Group has not released the date for when the contracts will be available for trading as of yet. However, they have announced that the trading venues will be CME Globex and CME ClearPort. These contracts are listed with, and subject to, the rules and regulations of NYMEX. CME Code Description VNA Natural Gas Quarterly Variance Futures VNS Natural Gas Semi-Annual Variance Futures VNQ Natural Gas Calendar Variance Futures
For VNA contract specifications, click here For VNS contract specifications, click here For VNQ contract specifications, click here For JER contract specifications, click here For SWS contract specifications, click here For SRS contract specifications, click here For JCN contract specifications, click here

Fossil Fuel Markets

Platts Launches eWindow for European Propane Derivatives

Effective since April 17, 2013, Platts new eWindow tool listing Propane CIF NWE Cargoes outright values, Propane CIF NWE Cargo spreads and Propane CIF NWE Cargoes vs Naphtha CIF NWE cargoes is being used in Platts Market on Close assessment process for European LPG Derivatives. During the process, all Yahoo IM communication should be sent to plattseuronaphtha.

Platts Launches Price Assessment for Calcined Petroleum Coke

From May 31, 2013, Platts is proposing a new anode-grade calcined petroleum coke (CPC) monthly price assessment that would be suitable for aluminum smelters. Assessed and published monthly on the last business day of the month, the Platts Cal Pet Coke FOB US Gulf assessment would be published in a narrow price range and would reflect cargoes of 10,000 15,000 mt loading 30-60 days forward. Bids, offers and spot transactions for the benchmark grade would be taken into account in the assessment which would reflect the standard grade exported from the US Gulf. Input and output from suppliers, aluminum smelter buyers, traders and other active spot market participants would be used as a basis for the assessment, which will be assessed in dollars per metric ton .

NASDAQ OMX Launches Freight and Fuel Oil Futures and Options
On April 29, 2013, the NASDAQ OMX Group, Inc. listed freight and fuel oil futures and options for trading via its Block Trade Facility. The contracts will be cleared at NOS. NASDAQ announced that no American can transact in option contracts, nor can NOS clear any such option contracts for an American until further notice.

ICE Launches Gasoline and Distillates Contracts

On April 29, 2013, ICE introduced new gasoline futures and distillates futures and average price options, listed below: ICE Code AEB RBA UCE GPV-GQZ JER SWS SRS JCN Description Argus Eurobob Oxy FOB Rotterdam Barges vs Brent 1st Line Future (in Bbls) RBOB Gasoline 1st Line vs Argus Eurobob Oxy FOB Rotterdam Barges Future (in Bbls) Premium Unleaded Gasoline 10ppm CIF NWE Cargoes (Platts) Future Singapore Jet Kero (Platts) vs Singapore Gasoil (Platts) Balmo Future Jet FOB Rotterdam Barges (Platts) Future Singapore Gasoil (Platts) APO Singapore Jet Kerosene (Platts) APO Jet CIF NWE Cargoes (Platts) APO

Platts Introduces New OSPs for Nigerian Crude

From June 2013, Platts is proposing to publish the Official Selling Price for four Nigerian grades on a monthly basis, as issued by the Nigerian National Petroleum Corporation. They are Oyo, Okwuibome, Ebok and Usan. Platts will publish the OSPs on Platts Global Alert page 1062 .

Platts Proposes USGC UL SHO Assessment

Platts is proposing a new U.S. Gulf Coast ultra-low sulfur heating oil assessment, reflecting 15-ppm sulfur ULS specs for heating oil use and the prompt Colonial Pipeline cycle. The assessments specifications would be equivalent to Colonial Pipelines 67 grade. Comments can be sent to pricegroup@platts.com by May 1, 2013.

For AEB contract specifications, click here For RBA contract specifications, click here For UCE contract specifications, click here For GPV-GQZ contract specifications, click here

Back to Summary

datawatch May 2013 NASDAQ OMX Launches Block Trades for Freight and Fuel Oil
Since April 29, 2013, NASDAQ OMX has been listing Freight and Fuel Oil contracts on its regulated exchange, the NASDAQ OMX Oslo ASA, which can be executed through its Block Trade Facility. This is available for existing NOS clearing members that have an arrangement with a Block Broker Member or are themselves Exchange Members. All Block Trades executed must follow the rules of the Exchange. They should be submitted to the Exchange within opening hours and 15 minutes after matching, or if they are matched outside of these hours they should be submitted in the 15 minutes prior to opening hours the next day. Standard affirmation procedures will be followed.

Fossil Fuel Markets Platts to Cease Assessments for FD NWE and FOB Rotterdam Styrene
Due to market conditions, Platts is proposing to cease its FD Northwest European and FOB Rotterdam contract price assessments for styrene barges from November 1, 2013. Platts also assesses FOB Amsterdam-Rotterdam-Antwerp contract prices for styrene barges, however it is proposing to continue publishing this assessment. The assessments are currently published in Petrochemical Alert on PCA376 and in the Europe and Americas petrochemical Scan. Comments can be sent to petchems@platts. com with a copy to pricegroup@platts.com by September 1, 2013.

Platts to Discontinue Certain Dirty Tanker Rate Assessments

On June 3, 2013, Platts will end a number of dirty tanker rate assessments for certain European oil routes due to changes in European supply flows which have rendered the routes less commonly used in the market. These assessments are published in the Platts Dirty Tankerwire on Platts Global Alert page 946 or Platts Clean Tankerwire, on page 558, and in Platts market data services. They are: Database Assessment code AAKXB00 Dirty Baltic-UKC Worldscale Basis (27.5kt) Daily AAKXG00 Dirty Baltic-UKC Worldscale Basis (27.5kt) Monthly Average AAKXM00 Dirty Baltic-UKC $/mt (27.5kt) Daily AAKXR00 Dirty Baltic-UKC $/mt (27.5kt) Monthly Average AAKXBSZ Dirty Baltic-UKC (27.5kt) cargo size AAKXD00 Dirty UKC-Med Worldscale Basis (27.5kt) Daily AAKXI00 Dirty UKC-Med Worldscale Basis (27.5kt) Monthly Average AAKXT00 Dirty UKC-Med $/mt (27.5kt) Daily AAKXO00 Dirty UKC-Med $/mt (27.5kt) Monthly Average AAKXDSZ Dirty UKC-Med (27.5kt) cargo size AAKXF00 Dirty Med-Med Worldscale Basis (27.5kt) Daily AAKXK00 Dirty Med-Med Worldscale Basis (27.5kt) Monthly Average AAKXQ00 Dirty Med-Med $/mt (27.5kt) Daily AAKXV00 Dirty Med-Med $/mt (27.5kt) Monthly Average AAKXFSZ Dirty Med-Med (27.5kt) cargo size PFALZ00 Clean UKC-Med MR Worldscale Basis (30kt) Daily PFARL03 Clean UKC-Med MR Worldscale Basis (30kt) Monthly Average TCABT00 Clean UKC-Med MR $/mt (30kt) Daily TCABT03 Clean UKC-Med MR $/mt (30kt) Monthly Average PFALZSZ Clean UKC-Med MR cargo size

Platts Discontinues Shell Canada Crude Price Postings

Since April 8, 2013, Platts is no longer publishing Shell Canadas crude prices for Koch Alberta at Edmonton, Light Sour at Cromer and Medium at Cromer, due to Shell discontinuing these postings. Shell will discontinue its Light Sweet at Edmonton crude posting on October 31, 2013, meaning Platts will no longer publish this posted price after November 1, 2013. Shell Canadas crude postings are published on Platts PGA page 252, in the Oilgram Price Report, the Oil Arbitrage Wire and in the Platts database under the following codes: Light Sweet Edmonton (PSASF09), Midale Cromer (PSATC09), Light Sour Cromer (PSATZ00), Koch Sour Edmonton (PSAUD00) Comments can be sent to jeff_mower@platts.com, with a cc to pricegroup@platts.com.

Platts Cease USAC Supplemental Gasoline Assessments

On April 15, 2013, Platts published its final US Atlantic Coast supplemental assessments of 13.5 RVP gasoline products. Platts will relaunch supplemental assessments in the fall; dates will be announced closer to the time. Comments can be sent to Americas_ products@platts.com with a CC to pricegroup@platts.com.

Back to Summary

datawatch May 2013 Platts CFR Korea isomer-MX Assessments Postponed

On July 1, 2013, Platts will launch its daily CFR Korea isomermixed xylene assessments. They were previously scheduled to launch on May 6. The isomer-MX in the assessment will meet the specifications under ASTM D5211 or ASTM D843. Cargo sizes of 3,000 mt to 5,000 mt will be reflected in the daily price, with 30 days Letters of Credit (LC) for Asian origin and 60 days LC for deepsea origin for deliveries to Daesan, Ulsan, Yeosu and Inchon as the credit terms. Information from the market up to the end of the Platts Market on Close assessment processes at 4:30 pm Singapore time will be used as a basis for the assessment. Queries can be sent to pl_asia_petchem@platts.com with a copy to pricegroup@platts.com by June 14, 2013.

Fossil Fuel Markets Platts Aligns Timing Guidelines for European Propane Derivatives
Effective since April 17, 2013, Platts timing guidelines on its European LPG derivatives assessment process have been aligned with other European markets standards. It is now necessary for spread positions for derivatives to be received by 16:15:01 London time and outright positions for derivatives received by 16:20:01 London time, in markets where bids/offers are submitted via eWindow directly. Queries on this can be directed to europe_ products@platts.com, with a cc to pricegroup@platts.com.

Platts Publishes AZRBOB Reflecting 5.7 RVP

Effective from April 22, 2013, Platts is publishing AZRBOB 84-octane and 88.5 octane gasoline assessments with lower RVP levels of 5.7and will continue to do so throughout the summer. In the past, assessments for Arizona CBG (AABEG00 for 87 octane and AABEK00 for 91 octane) were published during the summer months by Platts in accordance with Kinder Morgans CALNEV system pipeline schedule. Kinder Morgan will not be shipping CBG on its CALNEV system in 2013 and will ship the lower RVP AZRBOB assessments instead.

Platts to Refine European Steam Cracker Margin Model

On April 5, 2013, Platts proposed to refine the European steam cracker margin model based on advances in the contributions from butadiene credits and reported increased efficiencies in the industry. The refined Platts Cracker Margin formula in spot and contract cracker margin assessments would be: PCM= 0.96*Ethylene FD NWE + 0.54*Propylene FD NWE + 0.19*benzene CIF ARA 3-30 days forward + 0.55*gasoline 10 ppm FOB Rdam barge + 0.17*butadiene FD NWE + (-0.0935*LSFO 1% CIF NWE) + (-3.13*Naphtha CIF NWE cargo). The current formula used in PCM calculations is: PCM = 0.96*Ethylene FD NWE + 0.54*Propylene FD NWE + 0.19*benzene CIF ARA 3-30 days forward + 0.55*gasoline 10 ppm FOB Rdam barge + (-0.11*LSFO 1% CIF NWE) + (-3.13*Naphtha CIF NWE cargo).

Platts Postpones Discontinuation of NWE T1 Methanol Assessments

Platts discontinuation of its daily and weekly (PHACN00 and PHBGA03 respectively) T1 CIF European methanol spot price assessments was postponed from April 18, 2013 to May 1, 2013. Platts has been publishing these assessments on the Platts Petrochemicals Alert (PCA) service line and store them in the Platts database.

Platts Aligns NWE Benzene Forward Curve Month Roll

On April 24, 2013, Platts aligned the NWE benzene CIF ARA forward physical curve month roll with the NWE M1/M2 benzene spot assessments. It did this by adjusting the timing from the first calendar day of each month to the fifth working day prior to the first UK working day of the first contractual month.

Platts Updates USGC Naphtha Specifications

Platts is proposing to update the specifications for its US Gulf Coast heavy naphtha and naphtha assessments from July 1, 2013. This is based on industry discussions on the impact of lighter shale crudes on the domestic reformer-feed naphtha market. Depending on the feedback received, the specifications being proposed for heavy and standard naphtha assessments include: N+A: IBP: 10%: FBP: API: Sulfur: Color: RVP: Heavy Naphtha min 38% vol. min 160F min 175F max 395F max 58 max 350 ppm min +20 max 3.5 psi Naphtha min 38% vol. min 110F max 175F max 395F max 63 max 350 ppm min +20 max 6 psi
Back to Summary

Platts Updates Global Crude Pages in PGA

The global crude pages on Platts Global Alert were updated on May 1, 2013. The new layout moved PGA Page 442 to PGA 2658. This contains Platts assessments for Dubai and Oman crude oil swaps.

datawatch May 2013

Heavy Naphtha max 3 ppm max 50 ppb max 50 ppm 1 ppm max max 1% < 1ppm liquids Naphtha max 3 ppm max 50 ppb max 50 ppm 1 ppm max max 1% < 1 ppm liquids

Fossil Fuel Markets

category in the Platts Market Assessment database. This reflects the fact these assessments are feeder crudes. Comments can be sent to PGA@platts.com by November 30, 2013. The affected assessments are: Current Category New category RI RW RI RW RW RW RW RW RW RW RW RW RW RW RW RW RW RW Code AAIIK00 AAIJA00 AAIJT00 AAIIT00 AAIJS00 AAIJC00 AAIJB00 AAIIP00 AAIJD00 AAIJU00 AAIIW00 AAIIR00 AAIIX00 AAIIQ00 AAIIM00 AAIIU00 Description Basrah Light Spot USGulf Weekly Gullfaks Spot North Sea Weekly Line 63 CIF Hynes Station Weekly Mixed Lt/Sr Spot Weekly Olmeca FOB Mexico Weekly Palanca/Soyo Spot W Africa Wkly Rabi Blend Spot W Africa Weekly Statfjord Spot Weekly Troll Spot North Sea Weekly Urals CIF Med Weekly Tapis Spot Weekly Kern River WAvg Kirkuk Ceyhan WAvg LLS St James WAvg Mars Clovelly WAvg Thums Long Beach Wavg

Nitrogen: Lead: Oxy: Chloride: Olefin: H2S:

Platts to Update Crude Oil Marketwire

From June 1, 2013, Platts will update the layout and content of its Platts Crude Oil Marketwire publication. Platts will add midpoints for all crude assessments in the newsletter together with the assessment high/lows and show a single change value that matches the new midpoint. The frequency of update to some of the yields and netback will be increased and new refinery margins will be added. It will also be clearer to the reader where they can find the data in the newsletter in the corresponding Platts Global Alert and other real-time information services. Page numbers may change as a result of this revamp, however all assessment name sand table headings will remain the same. A sample of the new newsletter can be viewed here: http://plts.co/CrOM2

RI RI RI RI RI RI RI RI RP RU RU RU RU RU

Platts to Relocate Third-Party Oil Data in Database

Platts is proposing a relocation of certain third party oil data from current market data categories to the OX data category in Platts Market Assessment database from May 1, 2014. Comments can be sent to PGA@platts.com up until November 30, 2013. Affected data can be found here: http://www.platts.com/ SubscriberNotesDetails/21935861

Platts to Relocate Certain Asia Crude Data

From May 1, 2014, Platts is proposing a relocation of certain Asia crude assessments from RI (London-close crude assessments) to RP (Singapore-close crude assessments) category in the Platts Market Assessment database. This will show that the assessments represent the value of crudes at the close of trading in Asia. Data for Asia crude that reflects the value of those markets at the close of trading in Europe would be relocated to RI category. Comments can be sent to PGA@platts.com. Affected data can be found here: http://www.platts.com/SubscriberNotesDetails/21935961

Platts to Relocate Certain US Crude Data in Database

From May 1, 2014, Platts is proposing to move particular US crude assessments from the RI (London-close crude assessments) to the RU (Houston-close crude assessments) data category in Platts Market Assessment database. This will show these assessments are representative of the value of crudes at the close of trading in the US. Comments can be sent to PGA@platts.com. The affected assessments are: Current Category New Category Code RI RU AAEJH00 RI RU AAEJI00 RI RU RU RU RU AAGWV00 AAGWW00 AAQBF00 AAQBF03 Description Basrah Light USGC Basrah Light USGC MAvg Basrah Light USGC vs WTI Mo02 Basrah Light USGC vs WTI Mo02 MAvg Americas Dated Brent Americas Dated Brent MAvg

Platts to Relocate Certain Feeder Crude Data in Database

From May 1, 2014, Platts is proposing a relocation of certain feeder crude assessments from RI (London crude assessments), RP (Singapore crude assessments) and RU (Houston crude assessments) categories to the RW (weekly feeder crudes)

RI RI RI

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datawatch May 2013 ICE Futures Europe Postpones Introduction of Additional Options
April 26, 2013, ICE Futures Europe announced it will postpone the introduction of 13 of their additional 22 ICE Futures Europe Options Contracts, which comprise five Oil Options and eight Wet Freight Options. For details, please refer to ICE Futures Europe Circular 13/063. ICE Code SWS SRS JCN PDB DBI WNU WSJ WMJ WSL WCN WGJ WAU WNC < 1ppm liquids Description Singapore Gasoil (Platts) Average Price Option Singapore Jet Kerosene (Platts) Average Price Option Jet CIF NEW Cargoes (Platts) Average Price Option Dated Brent (Platts) Average Price Option Dubai 1st (Platts) Average Price Option TC2 FFA- Northwest Europe to USAC (Baltic) Average Price Option TC4 FFA- Singapore to Japan (Platts) Average Price Option TC5 FFA- Arabian Gulf to Japan (Platts) Average Price Option TC6 FFA- Skikda to Lavera (Cross Med) (Baltic) Average Price Option TC14 FFA- USGC to Continent (Baltic) Average Price Option TD3 FFA- Arabian Gulf to Japan (Baltic) Average Price Option TD5 FFA- West Africa to USAC (Baltic) Average Price Option TD7 FFA- UK North Sea to Continent (Baltic) Average Price Option < 1 ppm liquids

Fossil Fuel Markets

New NGX CPA Amendments

Effective May 13, 2013, further revisions of NGXs Contracting Partys Agreement are being enforced. For details of the amendments, please refer to NGXs Notice of Amendments to CPA.

CME Changes Strike Prices for Henry Hub Financial Option

On May 13, 2013, NYMEX removed strike prices for Henry Hub Natural Gas European Financial Option. Specifically, NYMEX is removing 0.01 strike prices with no open interest that have never traded from CME Globex, the NYMEX Trading Floor and from CME ClearPort. Market participants can still dynamically create 0.01 strike prices on the NYMEX Trading Floor and on deals submitted for clearing on CME ClearPort. CME Code LNE Description Henry Hub Natural Gas European Option

Below is an average daily strike price for NYMEX Natural Gas EuropeanStyle Options:

Data Source: CME*

*Graph created with ZEMA

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datawatch May 2013 NCDEX Introduces e-mandis

On March 26, 2013, NCDEX introduced a new electronic platform, e-mandis, also known as e-mandi, to bring in transparency in the system while creating a level playing field for the market participants. Previously in India, farmers have not received an optimum price for their products. Lack of information about the market had long impacted both buyers and sellers. The new electronic platform seems like a win-win situation for both buyers and sellers, where the farmer receive the best prices for the produce they sell on time and the buyers are assured of the quality of the produce they buy. As more buyers and sellers accept this system, there will be more efficient price discovery in the system on higher volumes, which accelerates the virtuous cycle of prosperity for all.

Agriculture, Forestry and Metal Markets

Together they will provide conservation planning assistance for farmers who supply bio-based feedstock to bio-refineries as the industry begins to commercialize. A conservation plan will be written for individual operations to ensure sustainable harvest of corn crop residues while boosting natural resource conservation and land productivity. CME Code TIO Description Iron Ore 62% Fe, CFR China (TSI) Futures

For TIO contract specifications, click here

The graph below shows average daily settlements for NYMEX Iron Ore Futures.

ICAP Expands Soft Commodities Group

On April 2, 2013, ICAP Corporates LLC announced the expansion of its soft commodities group to include a full-service cotton broking team. The three principals of VIP Commodities Ltd and ICAP have joined together to offer execution services in the open outcry pit, electronic, voice blocks and over-thecounter markets. The addition of this team further strengthens ICAPs soft commodities business, which serves clients in New York, Chicago, Louisville, London, Sao Paulo and Sydney.

Data Source: CME*

NOS Launches NASDAQ Salmon Index

On May 9, 2013, NOS Clearing ASA (NOS) launched the NASDAQ Salmon Index. The NASDAQ Salmon Index is the weighted average of weekly reported sales prices and corresponding volumes in salmon reported to NOS by a selection of Norwegian exporters and producers with export licenses. It will be available for viewing in several currencies. NOS worked closely with Fish Pool and key players in the salmon industry to establish the improved salmon spot price, which will act as an effective benchmark for buyers and sellers. The NOS website will continue to have historical data available for analysis purposes.

DCE to Start Egg Futures Trading

On April 13, 2013, Dalian Commodity Exchange (DCE) performed networking tests for egg futures trading to ensure that the existing system can successfully list and trade them. In response to the recent outbreak of avian flu, egg futures contracts are still under detailed and rigorous examination to ensure smooth and safe trading and delivery of eggs during epidemics. DCE will launch the listings after approval. For instance, trading will be suspended and trading terminated to control market risks when there are outbreaks. The tests included a total of eight contracts, jd1309, jd1310, jd1311, jd1312, jd1401, jd1402, jd1403, and jd1404. The listed benchmark price of the tested contracts was RMB 4,000/500 kg; the maximum volume of order per trading instruction was 300 lots; the trading limit of new contract was set at 8% of the listed benchmark price; the trading limit of contract of the month prior to the delivery month was 4% of the settlement price of the previous trading day; and the contract trading limit of the delivery month was 6% of the previous trading days settlement price.

CME Group Adds Iron Ore 62% Fe and CFR China

On May 13, 2013, CME Group listed Iron Ore 62% Fe, CFR China (TSI) futures and calendar spreads for trading. The trading venues are CME Globex, CME ClearPort and Open Outcry. These contacts are listed with, and subject to, the rules and regulations of NYMEX.
*Graph created with ZEMA

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datawatch May 2013 ICE Launches New Iron Ore Future

On April 29, 2013, ICE introduced a new iron ore futures contract, listed below: ICE Code IOT Description Iron Ore 62% Fe (TSI), 500 dmt CFR Tianjin Future

Agriculture, Forestry and Metal Markets

As part of the integration, paper wheat receipts will be converted into electronic receipts through E-Grain. Beginning June 1, 2013, clearing firms holding paper receipts can submit original receipts to the Kansas City Board of Trade Office located at 4800 Main Street, Suite 303, Kansas City, MO, 64112, for conversion. The new functionality will be made available in the New Release environment for testing purposes prior the July 2013 delivery month.

Platts Ceases Weekly Japan and China Molybdenum Assessments

On April 30, Platts ceased to assess moly oxide on a CIF Japan basis and moly oxide FOB China, which are published weekly on Platts Metal Alert pages 418 and 417 respectively. The discontinuation will help avoid possible duplication or conflict with the global daily assessment of Molybdenum Dealer Oxide, which includes dealer-to-consumer, producer-to-dealer, dealer-to-dealer and producer-to-consumer spot business in-warehouse European ports, delivered US and CIF Japan main ports, CIF South Korean ports and CIF Nhava Sheva/Mumbai, India.

Platts Extends Consultation Period on Iron Ore Lump

Platts scheduled the initial publication of its weekly iron ore lump premium spot price assessment for May 8, after extending the industry feedback period so it could gather additional views from the industry. The extension period was warranted after Platts received new information on the physical properties of lump and the trade practice of merging lump with fines in single shipments.

Platts Clarifies Assessment for North American Lead

On May 1, 2013, Platts clarified its North American lead price assessment and associated lead premium. Currently, the US premium for refined lead, which is used to calculate the North American lead price assessment, is assessed on a weekly basis. Platts is proposing to publish this internal premium in Platts Metals Alert and Platts Metal Daily. Platts also made a methodology modification to its North American lead price assessment, which currently uses the weekly range of the low and high London Metal Exchange (LME) cash settlement price for lead, converted into cents per pound plus the premium. The modified assessment would use a daily formula assessment with the current days LME lead cash settlement price in cents per pound, plus the weekly premium. Every week on a Tuesday the lead prices will be assessed.

CME Integrates with Kansas City Board of Trade

On April 22, 2013, CME Group announced the Hard Red Winter (HRW) Wheat delivery process will be integrated fully into Deliveries Plus with the July 2013 HRW Wheat (KW) contract. The functionality will allow clearing firms to manage the delivery process through the user interfaces. The functionality will include the following: Wheat registration Long date reporting Intent submission Assignment processing Reports Invoicing

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datawatch May 2013 ICE Launches Three North American Environmental Futures
On April 29, 2013, ICE Futures U.S. introduced three new North American environmental futures contracts, listed below: ICE Code RIB RID RIF Description RIN D4 (Platts) Future RIN D5 (Platts) Future RIN D6 (Platts) Future

Environmental Markets and Weather Services AccuWeather Traffic App Includes Traffic News and Driver Data
On April 10, 2013, AccuWeather announced its StoryTeller Traffic app will now include INRIX travel times, traffic camera images as well as real-time traffic, and incident information. With the incorporation of the INRIX platform, real-time data will be collected from hundreds of sources including road sensors, accident and incident reports, and crowd-sourced information from millions of vehicle and devices to deliver up-to-the-minute insight.

For contract specifications, please click on the description links.

Final Date of ICE EUA Phase 2 Trading

Effective from June 27, 2013, ICE EUA Phase 2 Daily Futures Contracts will no longer be available for trading. For more information on the end of the second trading period of the EU Emissions Trading Scheme, please refer to the European Commissions update.

Weather Underground Introduce Earth Day Microsite

In conjunction with Earth Day on April 22, 2013, Weather underground launched an Earth Day microsite within its wunderground.com website. The microsite offers information on climate change and global warming in the form of videos, articles and info graphics from climate experts and scientists. The aim of the site is to provide readers with knowledge of the climate system and ways to reduce the acceleration of climate change. Access the site here: http://www.wunderground.com/earth-day/2013

NOAA Updates Chemical Reactivity Worksheet Software

On April 3, 2013, the NOAA and Dow Chemical announced they upgraded their free software known as the Chemical Reactivity Worksheet. This tool is used to predict how 5200 chemicals react when combined. The software now includes an alert for possible gases released if certain chemical are mixed and will be used for emergency response, and planning tools for releases of hazardous materials.

AccuWeather Adds Seven New Apps to StoryTeller System

On April 3, 2013, AccuWeather announced the addition of seven new apps to its StoryTeller Interactive Touchscreen System. The new apps add expanded capability to cover breaking news, finance and business, sports, entertainment, elections and weather, as well as tools for in-depth feature story segments.

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datawatch May 2013 ICE Launches Four New Credit Index Futures
Effective May 1, 2013, ICE Futures US are being listed as four new credit index futures contracts based on the Markit CDX and iTraxx indexes. The new contracts are based on indexes managed and administered by Markit Group Limited. Two are based on credit instruments of North American companies (CDX North American Investment Grade and High Yield indices) and two are based on credit instruments of European companies (iTraxx Europe and iTraxx Crossover indexes). Each index measures credit risk five years forward. For their respective Contract Specifications, please refer to the links provided below: Markit CDX Investment Grade WI Futures Markit CDX High Yield WI Futures Markit iTraxx Europe WI Futures Markit iTraxx Xover WI Futures

FX, Interest Rates, Credit, and Equity Indexes

NYSE Euronext Launches SME Marketplace

On May 23, 201, NYSE Euronext (NYX) launched SME Marketplacea subsidiary dedicated to strategy and resources for small and medium-sized companies (SMEs). Developed in conjunction with market participants, SME Marketplace is a key component of a dynamic financing framework designed for SMEs. It will cover the current B and C compartments of NYSE Euronexts regulated market, as well as NYSE Alternext in European countries where NYSE Euronext operatesa total of nearly 800 companies. SME Marketplace will be managed by a subsidiary set up in France, and it will have its own brand, operating budget and team that will be headed by a CEO recruited externally and a 15-member international board of directors, seven external directors and seven directors from NYSE Euronext. These will be announced on May 23.

ICE Launches Russell 2000 Growth and Value Index Futures

On April 22, 2013, ICE announced it will begin trading two new Russell Index futures contracts based on the Russell 2000 Growth and Russell 2000 Value Indexesa US small cap equity benchmark. They will be listed by ICE Futures US and cleared at ICE Clear US Exchange. Approximately $3.9 trillion or 99 percent of all small cap US institutional assets are benchmarked to Russell Indexes. These contracts will also be eligible for Trade at the Index Close (TIC) trading, which allows bids and offers to be placed during the course of the day at a price differential to the closing price of the underlying stock

STOXX and Eurex Repo Launch GC Pooling Indexes

On April 16, 2013, STOXX Limited announced the launch of the STOXX GC Pooling index family, including the migration of the existing GC Pooling indexes calculated by Deutsche Brse into the new index family. The STOXX GC Pooling indexes provide a representation of the secured euro funding transactions taking place on the Eurex Repo GC Pooling Market. A unique feature of this index family is the introduction of two funding rates that measure secured interbank funding rates and volumes in the euro zone. The STOXX GC Pooling index family will be calculated in euros and will be available end-of-day.

Tradition Launches ParFX Trading Platform

On April 18, 2013, Tradition announced the launch of its new spot FX trading platform ParFX, which is now open to all banks able to settle via CLS. The platform is focused on transparency and equality for all participants and includes new features such as enhanced trade cycle transparency, at-cost market data, transparent trading prices, low cost and easy access through FIX, incorporation of trading costs into actual transactions and increased competition among trading venues.

NYSE Liffe Adds Equity Options on NSI N.V.

On April 23, 2013, NYSE Liffe launched equity options on NSI N.V for the Amsterdam derivatives market, providing investors with additional investment opportunities and added value to the liquidity of the underlying share. Using ticker symbol NSI, each option will represent 100 shares in NSI with an expiration date of the third Friday of the contract month. Initial maturities will be one to six months and options will be cleared via LCH. Clearnet SA. NSI is a listed closed-end real estate investment company with variable capital that invests in retail and offices in high-quality locations in Belgium and the Netherlands. Being a constituent of the AMX-Index, companies listed on the 21 AMX or AEXIndex will have an equity option listing.

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datawatch May 2013 Markit Announces Markit iBoxx US Non-Agency RMBS Indices
On April 10, 2013, Markit launched Markit iBoxx US Non-Agency RMBS indices, which aims to provide market participants with a useful historical dataset and continuing reference points to assess the returns of the US Non-Agency RMBS market. Included in the indices are 27 sub-indexes which are divided into four categories: Prime, Sub-prime, Alt-A, and Option ARM. The 27 indexes reference roughly 350 senior bonds from a portfolio of 22,000 RMBS issued between 2005 and 2007. The Markit iBoxx index calculation methodology is used for the new indexes, which are selected according to deal size, pricing date and the type/quality of the mortgages referenced in each deal.

FX, Interest Rates, Credit, and Equity Indexes S&P Dow Jones Indices Licensed CDCC to Clear OTC Options
On April 15, 2013, S&P Dow Jones Indices licensed the Canadian Derivatives Clearing Corporation (CDCC) to clear Over-TheCounter (OTC) options based on the S&P/TSX suite of indexes. This is the first license for clearing OTC trades in Canada. CDCC is expected to launch the clearing service via its Converge offering in June 2013. The licensing agreement between the two indexes provides the potential for improved risk management in the OTC equity derivatives marketplace served by these key indexes. For more information about CDCC, please visit: www.cdcc.ca

Montral Exchange Launches Futures on Trading Simulator

On April 22, 2013, Montral Exchange Inc. (MX) launched futures contracts on its Trading Simulator. The futures contracts available include: BAX, CGZ, CGF, CGB, LGB, SXF, SXM, SCF, SXA, SXB, SXH, and SXY. MX aims to enhance investors knowledge of both options and futures while providing a tool that best represents the Canadian derivatives through offering the full suite of Canadian derivatives on the Trading Simulator, said MXs President and CEO Alan Miquelon.

Market Impact of Europe 2020 Goals

In recent years the EU has committed itself to growth plans that include ambitious targets for climate change and sustainability. Known as the Europe 2020 growth strategy, they involve a greater focus on renewable energy, energy efficiency and the reduction of greenhouse gas emissions. However the opposing forces of these goals and the ongoing financial crisis are having an impact on European electricity, natural gas and emissions markets. Join ZE for our upcoming complimentary webinar - Market Impact of Europe 2020 - to learn more about the current situation in Europe. Date: Wednesday, June 5, 2:00 PM - 3:15 PM BST.

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datawatch May 2013 Wall Street Journal Launches Turkish Website

On April 2, 2013, the Wall Street Journal (WSJ) announced the launch of its Turkish language website, further expanding its global digital reach. The WSJ now has a total of 12 different websites in nine different languages. These sites are edited locally to ensure readers are supplied with regionally focused content.

Other Matters

Markit Acquires a DTCCs Stake in MarkitSERV

On April 5, 2013, Markit announced the acquisition of the ownership stake in MarkitSERV from the Depository Trust and Clearing Corporation (DTCC). MarkitSERV was founded in 2009 as a joint venture by Markit and DTCC, combining the electronic trade processing services for OTC derivatives of both firms. It will continue to be a separate entity that is regulated by the Financial Conduct Authority in the UK and will not change the services it offers.

Markits Portfolio Valuations Service Has New Risk Tools

On April 23, 2013, Markits Portfolio Valuations service had a range of risk and scenario analysis tools added to its offering. Customers can stress test the market data inputs used to generate their valuations with the new Scenario Analysis service. As well as this they have access to a fully-hosted solution for gauging the market risk within a portfolio of trades with the new Risk Analysis platform. These new services allow for compliance with international regulations as they enable customers to receive independent Value-at-Risk (VaR) and stress testing results that are aligned with their mark-to-market valuations.

Markit Launches European Commission Management Platform

On April 16, 2013, Markit announced the availability of its commission management service in Europe. The service, which helps buy-side firms to manage and allocate commission credits across sell-side institutions, is backed by a number of sell-side institutions. They are: BofA Merrill Lynch, Barclays, Citi, Credit Suisse, Deutsche Bank, Goldman Sachs, JP Morgan, and Morgan Stanley. Liquidnet, Sanford C. Bernstein, and UBS are sell-side customers of the platform.

NYSE: Consolidated Feed for Level 1 Market Data

On April 17, 2013, NYSE Technologies announced the launch of Best Quote & Trades (NYSE BQT), a consolidated XDP feed that provides a real-time, unified view of Level 1 market data. This includes Best Bid/Offer and Last Sale information for the NYSE, NYSE Arca, and NYSE MKT exchanges, including NASDAQ issues traded on NYSE Arca and NYSE MKT. NYSE BQT is a more flexible and affordable alternative to the range of expensive Level 1 market data offerings currently available to market participants.

ISE Presents New Options Exchange, ISE Gemini

ISE announced its new options exchange ISE Gemini should launch in Q2 2013, pending SEC approval. ISEs form 1 application for a second exchange license was published by the SEC in March. The new complementary options platform will function parallel to the existing ISE options exchange, leveraging the existing technology infrastructure and member connectivity to offer a choice of market and pricing models to member firms. A fee schedule and products traded on ISE Gemini will be announced at a later date.

Xetra Launches New State Street Bond Index ETF

On April 25, 2013, Xetra added a new exchange-listed bond index fund issued by State Street Global Advisors (SPDR). The aim of the SPDR Barclays EM Inflation Linked Local Bond UCITS ETF is to track the performance of government bonds from individual emerging-market countries in local currencies with protection against inflation risk. The reference index, Barclays Emerging Markets Inflation Linked 20% Capped Index, includes inflationprotected bonds from the following countries: Brazil, Chile, Israel, Korea, Mexico, Poland, South Africa, Thailand, and Turkey, while limiting the maximum weighting of a single country to 20%. ISIN Code Description IE00B7MXFZ59 SPDR Barclays EM Inflation Linked Local Bond UCITS ETF

HKEx Announces OTC Clears New Founding Shareholders

On April 8, 2013 the Hong Kong Exchanges and Clearing Limited (HKEx) announced that 12 financial institutions will be joining OTC Clearing Hong Kong Limited (OTC Clear) as founding shareholders. Some of these institutions include, Agriculture Bank of China Limited, Hong Kong Branch, Bank of China Limited, Citibank, Deutsche Bank and JP Morgan. They will join as non-voting shareholders who will receive dividends, appoint directors to the board and nominate representatives to the clearing houses user committee.

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datawatch May 2013 NASDAQ OMX Introduces Pre-Trade Risk Management Tools
On April 16, 2013, NASDAQ OMX Commodities announced it will provide members with optional Pre-trade Risk Management (PRM) controls in Genium INET, subject to successful testing and regulatory approval. Members can have order-level control of their trading activity as well as the trading activity of their clients, including prevention of potentially erroneous transactions by using the PRM service. PRM has been tailored specifically for General Clearing Members needs, but the service also meets the needs for improving pretrade protection for any member. Genium INET will be upgraded to version 0230 from June 8 to 9, 2013. More details regarding this feature are still to come.

Other Matters IIRC Presents International Integrated Reporting Framework

The International Integrated Reporting Council (IIRC) presented a new framework document for companies trading in exchanges in Brazil, South Africa, Germany, Australia, Canada, China, the U.S., India, Japan and the UK. It is available for 90 days on the IIRC web portal for consultation and suggestions. The framework document provides guiding principles to promote the integration of financial, sustainability and governance information in corporate reports, including a focus on strategy and guidance for the future; connectivity of information; stakeholder responsiveness; materiality and conciseness; coherence and comparability. The document will be for use by the market in 2014.

NYSE Liffe Welcomes KGI Futures as Newest Member

On May 2, 2013, NYSE Liffe announced that KGI Futures Co Ltd, a leading futures brokerage in Taiwan, is joining the exchange as its 14th Asian member in the London and Paris markets. The Asian membership of NYSE Liffe has doubled within the last six months, with four other new members joining NYSE Liffe this year. Customers of KGI Futures will now be able to access the exchanges European derivatives contracts and NYSE Euronexts market leading technology services, such as colocation and order routing. .

NASDAQ OMX Completes Acquisition of 25% Stake in TOM

On April 22, 2013, the NASDAQ OMX Group, Inc. announced that it has received the necessary regulatory approval for the completion of its acquisition of 25% of the Dutch cash equity and equity derivatives trading venue The Order Machine (TOM). The agreement also includes an option for NASDAQ OMX to acquire an additional 25.1% of the remaining shares to secure a majority stake in TOM. With this acquisition, NASDAQ OMX continues to expand its derivatives presence across the European market. As the only Multilateral Trading Facility in Europe trading derivatives with retail focus, the current shareholders will remain co-owners. In particular, BinckBank and ABN Amro will provide order flow while Optiver and IMC will provide liquidity in the Dutch market.

Wall Street Journal Launches Moneybeat Blog

On April 16, 2013 the Wall Street Journal announced the launch of its Moneybeat Blog, which will discuss global finance, markets, mergers and acquisitions. The blog critiques and analyzes trends and news stories in finance, markets, and deal-making. Moneybeat encompasses six of its most widely read blogs including: The Source, Marketbeat and Overheard.

Eurex Deepens Dialogue with China

On April 19, 2013, Deutsche Brse Group and its subsidiary Eurex became the first non-Chinese exchange operator to hold a conference on the derivatives markets. The one-day conference China Europe Derivatives Market Forum was held in Beijing. More than 220 representatives from Chinese exchanges, the China Futures Association (CFA), financial institutions and universities participated. Eurex aims to deepen dialogue with Chinese market participants and supervisory authorities by showing how the exchange can contribute to the countrys economic growth. In the course of the conference, it was emphasized that exchange-traded derivatives are indispensable as instruments for hedging risk and for investment purposes around the globe to protect against price and value fluctuation. Optiver and IMC will provide liquidity in the Dutch market.

Chi-X Canada Announces Pricing Schedule for CX2

On April 2, 2013, Chi-X Canada ATS Limited announced the pricing schedule for its new ATS, CX2 Canada ATS (CX2) market place, which launched on May 3. CX2 provides greater choice and cost savings opportunities to the retail investor and small to mid-tier brokers. The schedule is as follows: $1.00 or over Under $1.00 Active Rebate 0.0010 Active Rebate 0.0006 Passive Fee 0.0014 Passive Fee 0.0010 Hidden $1.00 or over Hidden Under $1.00 Active Free Active Free Passive Fee 0.0009 Passive Fee 0.0004

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datawatch May 2013

Other Matters Clearstream and Standard Chartered: a Global Liquidity Hub

On April 22, 2013, Clearstream and Standard Chartered Bank announced they were working on a customised collateral management solution for their mutual clients. The two companies have signed a Letter Of Intent (LOI) that signals the start of their development collaboration to enable their customers to benefit from the Liquidity Hub Connect collateral management service. The LOI enables client assets to remain in safekeeping with Standard Chartered while Clearstream manages all global collateral optimisation within its Global Liquidity Hub. Liquidity Hub Connect aims to help financial institutions to address the challenges they face in mobilising collateral in order to satisfy new market regulations. Optimising collateral ensures institutions can reduce financing costs and avoid maintaining excessive collateral buffers.

HKEx and Anhui Financial Services Sign MOU

On April 22, 2013 the Hong Kong Exchanges and Clearing Limited (HKEx) and Anhui Financial Services Office signed a Memorandum of Understanding (MOU) on cooperation of information.

HKEx and Chongqing Financial Services Sign MOU

On April 15, 2013 the Hong Kong Exchanges and Clearing Limited (HKEx) and Chongqing Financial Services Office signed a Memorandum of Understanding on cooperation and the exchange of information.

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May 2013

Monthly analytics for Power, Natural Gas, Crude Oil, and Environmental markets. Graphs prepared with ZEMA.
Actual Weather (AccuWeather)

Chicago saw temperatures rise dramatically in May with average daily temperatures all above zero and rising to a high of 22 degrees Celsius. Overall monthly averages saw temperatures rise across the country and overall temperature gap narrow as summer weather arrives. Despite the increase in temperature, May 2013 brought colder average temperatures than last year. In particular, average temperatures in Raleigh, NC, are down over 5 degrees Celsius year-over-year.

North American Electricity Day-Ahead Prices (ICE)

Power prices in the Northeast continued their decline from their February peaks of $140 USD/Mwh and $143 USD/Mwh. This is largely due to warmer weather and a continued trend of declining gas prices. CAISO and PJM monthly average prices fell slightly after gains for four and three consecutive months respectively.

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May 2013

Monthly analytics for Power, Natural Gas, Crude Oil, and Environmental markets. Graphs prepared with ZEMA.
Natural Gas Prices Spot Prices (ICE) Henry Hub Natural Gas Forward Curve (ICE)

Natural gas prices in the New York region have exhibited less volatility compared to the past month. With temperatures rising, a decline in demand caused prices in the Northeast to be slightly lower in May compared to April. Transcontinental Pipelines Zone 6 delivery point saw price spikes in early April, which were caused by demand increases from cool temperatures in the New York region. As temperatures have risen in May, prices have shown signs of stability.

With unchanged fundamentals on the long-term outlook, ICE Henry Hub natural gas futures exhibited an approximately 4% change compared to the last month. An interesting development has been the decline in spreads in 2014. This likely indicates lowering expectations for demand in the future.

Crude Oil Prices Prompt-Month Contract (NYMEX) Forward Curve (NYMEX)

In May, NYMEX prompt month contract for Brent Crude Oil and West Texas Intermediate (WTI) rose slightly compared to April as Asian currencies recovered against the U.S. dollar. On the New York Mercantile Exchange, Brent prompt month averaged around 100 USD/Bbl whereas WTI prices traded at 95 USD/Bbl. The gap between Brent and WTI prompt-month contract shrank to 5 USD/ Bbl, the narrowest in the past twelve months. Most industry experts believe that the Brent-WTI spread could easily widen back as a new growing glut of crude in Houston is starting to form on the Gulf Coast. Furthermore, U.S. crude-oil stockpiles have remained steady, according to Dow Jones Newswires. The spread has narrowed from 20 USD/Bbl back in November of last year to 5 USD/Bbl this month.

NYMEX Crude oil futures dropped in May but not by much. Brent crude oil futures for delivery in June traded at a premium of 8 USD/Bbl to WTI, which is almost 3 USD/Bbl lower than the previous month for June delivery. The Brent-WTI Spread of the NYMEX Forward contracts averaged 6 USD/ Bbl in May. Brent crude oil futures settled lowered as the market remains worried about the potential for oil demand growth as the preliminary Manufacturing Purchasing Managers Index fell in China, suggesting a potential slowdown in Chinas growing appetite for oil. Against all odds, WTI futures ended slightly higher due to growing optimism about the U.S economy after positive remarks from the Federal Reserve Banks statements and an increase in the Standard & Poors 500 Index. However, increase in U.S. gasoline stockpiles along with the surplus in crude oil stocks (due to higher imports and refinery outputs with lower than expected exports) continued to put pressure on U.S. oil prices.

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datawatch May 2013 New Data Reports for ZEMA

At ZE, we are continuously growing our data coverage. Our highly flexible data parsers can collect information in any electronic format, from any source and at a frequency. Since the April 2013 edition of DataWatch, we have added several new data reports to ZEMA: Data Source AMM - ITE Adjuntos al Informe AMM - ITE Adjuntos al Informe AMM - ITE Adjuntos al Informe AMM - ITE Adjuntos al Informe AMM - ITE Adjuntos al Informe AMM - ITE Adjuntos al Informe AMM - ITE Adjuntos al Informe AMM - ITE Adjuntos al Informe AMM - ITE Adjuntos al Informe AMM - ITE Adjuntos al Informe AMM - ITE Adjuntos al Informe AMM - ITE Adjuntos al Informe AMM - ITE Adjuntos al Informe AMM - ITE Adjuntos al Informe AMM - ITE Adjuntos al Informe Argus Argus Argus Argus CAISO CAISO CAISO CME CME EIA EIA EIA El Paso Gas Quality Gas Quality Gas Quality GIE Report PRECIOS EN EL MERCADO MAYORISTA Y MERCADO ELECTRICO REGIONAL RESULTADOS DE POTENCIA (Daily) RESULTADOS DE POTENCIA (Monthly) RESULTADOS DE POTENCIA (Monthly) - Summary TRANSACCIONES MER E IC (Daily) COSTOS DIFERENCIALES (Hourly) COSTOS DIFERENCIALES (Monthly) PEAJE PRINCIPAL (Daily) PEAJE PRINCIPAL (Monthly) GENERACION FORZADA (Daily) GENERACION FORZADA (Hourly) GENERACION FORZADA (Monthly) PEAJE SECUNDARIO (Daily) Transmission PEAJE SECUNDARIO (Daily) - by Region PEAJE SECUNDARIO (Monthly) Base Oil (Daily) - Futures Base Oil (Daily) - Spot Base Oil (Weekly) - Futures Base Oil (Weekly) - Spot Current Day Outlook Day Ahead Forecast Rolling Hour Ahead Forecast Daily KCB Futures Settlement KCB Options Settlement AQ - Monthly Fuel Receipts and Costs Monthly Fuel Receipts and Costs Monthly Stocks Data Gas Quality Natural Gas Quality of Kern River Natural Gas Quality of Kinder Morgan Natural Gas Quality of Tall Grass Aggregated Gas Storage Inventory Data Source

News from Data Vendors

Report Heren ICE IESO IHS Chemical IHS Chemical IHS Chemical IHS Chemical Interconnector Interconnector NEB NEB NEB Pegase Input Pegase Input Reuters Reuters ESGM+ UK and European Natural Gas Indexes 3 Hour Ahead Pre-dispatch Prices North America Aromatics Daily Futures North America Aromatics Daily Spot North America Aromatics Daily Futures North America Aromatics Daily Spot Historical Flow Daily Historical Flow Hourly RP Products - Historical Volumes by Category - Annual RP Products - Historical Volumes by Category - Monthly RP Products - Historical Volumes by Category - YTD Pegase Run Pegase Run - Maintenance Input EOD FX Forward - Futures EOD FX Forward - Spot

AMM - ITE Adjuntos al Informe TRANSACCIONES MER E IC (Monthly)

Argus Adds Ethanol Assessment for India

Singapore, 2 May 2013 Global energy and commodity price reporting agency Argus has launched the Argus India ethanol assessment to meet growing demand for price references and transparency in the market. The new assessment is in response to Indias mandate for increased ethanol blending in gasoline. The daily assessment is specifically for anhydrous ethanol, delivered to India. Indian demand for ethanol is expected to rise to as much as 2.2bn litres next year (38,000 b/d) to fulfil the countrys mandatory E5 blending. India plans to move to E20 blending by 2018. The new assessment will provide a useful reference for the growing number of traders, brokers, planners, analysts, risk managers and strategic decision makers that follow this market. Argus spot market price assessments are based on a robust methodology, and are expected to be used by governments, regulators, oil companies with ethanol and biofuel operations, chemical companies, commodity firms, beverage companies and exchanges. We are delighted to introduce this assessment within a month of launching ethanol fob Pakistan (hydrous), ethanol cfr Philippines and B-grade cfr northeast Asia assessments. Argus now provides comprehensive coverage of Asian ethanol prices, Argus Media chairman and chief executive Adrian Binks said.

Gas Quality Natural Gas Quality of Texas Eastern

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The new price assessment is published daily in Argus Biofuels, a global report covering various biofuel prices including assessments for Renewable Energy Directive (RED) compliant ethanol. More detailed information, including the methodology, is available on www.argusmedia.com/Bioenergy/Argus-Biofuels

News from Data Vendors

banks involved in risk management and/or project finance; brokers and exchanges; governments and regulators.

Argus Introduces Global Iron Ore Price Assessments

London, 13 May 2013 Global energy and commodity price reporting agency Argus has launched coverage of the global iron ore market with a new daily report, Argus Steel Feedstocks, focused on the all-important Chinese market. The launch reflects growing interest in spot iron ore assessments and the markets need for transparent and accurate price markers. The new Chinese price assessments cover cargoes for delivery to the port of Qingdao, northern China, and are accompanied by a daily iron ore market commentary. The three new assessments will cover 58% Fe, 62% Fe and 65% Fe iron ore fines, cfr Qingdao. The iron ore market coverage in Argus Steel Feedstocks will complement Argus existing coking coal spot price assessments, market commentary and global netback pricing. Iron ore is a key industrial commodity that until recently was overshadowed by its downstream product, steel. But, in recent years, there has been a shift towards shorter term contracts and spot trading, which has driven interest in robust independent price reporting. Seaborne iron ore volumes exceeded 1bn t in 2012 and demand for iron ore looks likely to continue to increase over the medium term, both in China and in the emerging economies of southeast and south Asia. This is Argus first step into assessing prices in the metals sector. The launch demonstrates Argus commitment to introducing our independent and transparent assessment of prices into markets that would benefit from our experience and expertise, Argus Media chairman and chief executive Adrian Binks said. Shifting international trade patterns and increasing production of sub60% Fe grades in Australia are changing the profile of the most traded products in the spot market. The introduction of these new price assessments in the Argus Steel Feedstocks report offers an impartial view of the global iron ore market. Argus Steel Feedstocks provides spot price assessments, market news and analysis. The report has been carefully designed to provide global iron ore and steel market participants with the critical insights, key statistics and data needed to stay ahead of market developments, as well as to help shape commercial strategies.

Argus Steel Feedstocks

Argus Steel Feedstocks provides essential reading for participants in the daily iron ore and coking coal markets, offering prices and commentary as well as extensive market-moving news. This service features key iron ore and coking coal prices, spot iron ore freight prices and netbacks accompanied by the latest news and analysis. The market-appropriate methodology is developed from regular consultation with market participants and covers major international traded iron ore and coking coal markets. Markets covered International iron ore prices - 58% Fe iron ore fines cfr Qingdao - 62% Fe iron ore fines cfr Qingdao - 65% Fe iron ore fines cfr Qingdao International coking coal prices - fob Australia - delivered Japan - cif north China - north China domestic $/t - north China domestic Yn/t - cfr east coast India - fob Hampton Roads (low vol) - fob Hampton Roads (high vol) - fob Colombia Caribbean (mid vol) - delivered Rotterdam Spot iron ore freight prices Spot coal freight prices Key features Daily prices for the international iron ore and coking coal markets Daily market commentary, market-moving news and analysis Latest news, issues and developments in the international iron ore and coking coal markets Easy to read graphs and charts Market snapshots Market appropriate methodology Benefits Argus Steel Feedstocks provides coverage about the international iron ore and coking coal markets and is essential reading to ensure you stay informed about daily prices, market movements and latest news. Customers Argus Steel Feedstocks subscribers include major and independent steel producers, iron ore miners, and other industrial end-users; traders, analysts and middle/back office functions; investment

Argus DeWitt Fuels and Octane Services

An Argus DeWitt market Service The fuels and octane service provides timely market updates,

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comprehensive analysis of events and trends, including coverage of regional supply/demand fundamentals, as well as contract and spot pricing for fuels and octane. Argus DeWitt also offers rolling 13-month price forecast. An annual study provides insight into the global fuels and octane supply/demand as well as present and future capacities for fuels and octane, trade flows and a five year forecast of production and consumption. Argus DeWitt consultants combine decades of experience and insight into the fuels and octane market to create personalised analysis. Markets Covered MTBE Alkylate Iso octane Toluene Ethanol Regions Covered Americas Europe/Middle East Asia/Pacific Key Features Ongoing commercial analysis of events and trends Current contract and spot pricing for the fuels and octane market The MTBE Outlook, a13-month rolling, price forecast for global MTBE and related markets Annual market overview of worldwide fuels and octane supply/ demand (including a five-year forecast), capacities, and trade flows for each country Argus DeWitt Analyst Access provides customers with tailored and on-going support to our experienced analysts Audience Anyone associated with the global fuels and octane market including producers, consumers, end users, traders, and investors, will find this service essential.

News from Data Vendors

worlds internationally traded coal derivatives. API 10 represents 6,000 kcal/kg NAR coal shipped from Colombias Caribbean terminals, a key coal supply area for North and South American and European coal markets. The assessment specifications include minimum net calorific value of 5,750 kcal/kg, which is representative of most Colombian export coal shipments. Argus Media chairman and chief executive Adrian Binks said: We are pleased to provide Colombias coal producers and consumers with this new assessment. With exports of 80mn t/yr, Colombia is a world-leading supplier and the new index reflects this crucial position in world markets. IHS publisher John Howland said: Colombia is now the key exporter to Europe and the Atlantic basin markets. The new API 10 index has been established in recognition of this and to provide the opportunity for market participants to trade the implied freight between API 10 and API 2. All the Argus and IHS McCloskey indexes are calculated by averaging the relevant Argus and IHS McCloskey price assessments. API 10 is derived from the Argus fob Puerto Bolivar assessments and the IHS McCloskey Puerto Bolivar FOB Marker prices. The methodologies used to derive these price assessments are available online at www.argusmedia.com/methodology and www.mccloskeycoal.com.

EPEX Spot: European Market Coupling Tests Begin

7 May 2013. The day-ahead price coupling projects for power markets in North-Western Europe (NWE) and South-Western Europe (SWE) today jointly announce the start of end-to-end testing across their combined regions, using the Price Coupling of Regions (PCR) system solution. The start of integration tests is a major step forward in accordance with the plan to start the European market coupling in November involving at least NWE. It follows many months of testing of the PCR systems, developed by European Power Exchanges to provide a single algorithm for determining efficient energy pricing and use of cross-border transmission capacity. This marks the start of a series of system integration, simulation and finally market testing during the summer and autumn of 2013, to be conducted jointly by the PCR project and the regional price coupling implementation projects. The implementation of PCR in this large part of Europe will be a significant point of progress towards a harmonised European dayahead electricity market, expected to increase liquidity, efficiency and social welfare. The initial testing in NWE and SWE confirms the readiness of the PCR system solution for starting implementation in other regions as well. The testing involves the Transmission System Operators (TSOs) and Power Exchanges in the NWE and SWE regions. The partners involved are the four Power Exchanges and 13 TSOs in the NWE region plus three TSOs and two Power Exchanges involved in the SWE region.

Argus/HIS McCloskey Launches API 10 Coal Assessment for Colombia

Houston, 21 May 2013 Global energy and commodity price reporting agency Argus and business information provider IHS McCloskey Coal today announced a major expansion of their joint coal indexes. Argus and IHS McCloskey Coal have added a new coal price to the Argus/McCloskeys Coal Price Index Report covering coal exports from Colombia. The expansion addresses demand from Colombian and Atlantic basin market participants for reliable independent benchmarks to use as price references in physical and derivative contracts. Argus and IHS McCloskey Coal already publish six indexes, which are used to settle almost 90pc of the

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The NWE project covers a price coupling involving the markets of Belgium, Denmark, Estonia, Finland, France, Germany/Austria, Great Britain, Latvia (June 2013), Lithuania, Luxembourg, the Netherlands, Norway, Poland (via the SwePol Link), and Sweden as well as the interconnections between them. The SWE project covers a price coupling between France, Portugal and Spain. About the projects: North-Western Europe (NWE) Price Coupling is a project initiated by the Transmission System Operators and Power Exchanges of the countries in North-Western Europe. The 17 partners of this project comprise APX, Belpex, EPEX SPOT and Nord Pool Spot from the Power Exchanges side; 50Hertz, Amprion, Creos, Elia, Energinet. dk, Fingrid, National Grid, RTE, Statnett, Svenska Kraftnt, Tennet B.V. (Netherlands), Tennet GmbH (Germany) and TransnetBW from the TSO side. This cooperation aims at establishing price coupling of the day-ahead wholesale electricity markets in this region, increasing the efficient allocation of interconnection capacities of the involved countries and optimizing the overall social welfare. A single algorithm, calculating simultaneously the market prices, net positions and flows on interconnectors between market areas will be used, based on implicit auctions and facilitated through Price Coupling of Regions. Price Coupling of Regions (PCR) is the initiative of seven European Power Exchanges, to develop a single price coupling solution to be used to calculate electricity prices across Europe, and allocate cross-border capacity on a day-ahead basis. This is crucial to achieve the overall EU target of a harmonized European electricity market. The integrated European electricity market is expected to increase liquidity, efficiency and social welfare. PCR is open to other European Power Exchanges wishing to join. South-Western Europe (SWE) Coupling Project is a joint project between the French, Spanish, Portuguese TSOs, Rseau de Transport dlectricit (RTE), Red Elctrica de Espaa (REE), Rede Elctrica Nacional (REN), and the Iberian and French Power Exchanges OMI Polo Espaol, S.A. (OMIE) and EPEX SPOT, in which are defined the pre-coupling, post coupling and exceptional situations processes that are necessary to allow the implementation of market coupling between France and the Iberian Market. To find out more about the PCR project and the regional price coupling implementation projects in NWE and SWE, visit the following websites: NWE region: www.apxgroup.com www.belpex.be

News from Data Vendors

12,600 emissions reduction projects (CDM and JI) in more than 120 countries The combined information amounts to more than 50,000,000,000 tCO2 of data disclosed on the worlds companies. For more information, download the new brochure providing a full description of data content, list of carbon markets and subscription options related to the World Emissions Trading Schemes Database: http://www.carbonmarketdata.com/cmd/publications/world_ets_ brochure.pdf

MDA Offers Power WxDesk for Weather, Load and Price Forecasting
MDA Weather Services offers a variety of data and reports used throughout the energy, agriculture, and weather markets. In addition to providing the basic data products used by traders worldwide throughout these industries (historic, ongoing, and forecast temperatures, precipitation, etc.), MDA goes beyond the numbers to provide unique datasets tailored for traders in each industry. Product offerings include the new Power WxDesk. MDAs brand new Power WxDesk is a weather, load, and price forecasting tool, all within the same interactive dashboard. Not only does this offer an accurate forecast, but also the confidence, risk, and change to the previous forecast to help with any necessary decision making all on the same dashboard. MDA produces the weather end of the Power WxDesk while partnering with TESLA for load data and kWantera for pricing data. All forecasts for all variables are updated on an hourly basis so it can be assured that all numbers being displayed are using the most up-to-date information. The product is fully customizable as well, allowing the user to select only the RTOs or other locations of interest. Also, weather, load, and price all do not have to be selected one can pick and choose one, two, or all three. The image below is a sample of what the Power WxDesk interface looks like.

Carbon Market World ETS Database Updates

Carbon Market Datas leading product, the World Emissions Trading Schemes Database, gathers information on power plants, industrial sites and companies participating to the growing number of cap-and-trade and carbon tax schemes around the world. This unique data platform currently includes CO2 emissions data on: 15,000 power plants, industrial sites and other facilities 10,000 companies from 160 countries

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datawatch May 2013 EEX-Powernext Gas Cooperation: PEGAS Launched Successfully

Leipzig, Paris, 29 May 2013 The European Energy Exchange (EEX) and Powernext are pleased to announce the launch of PEGAS, the natural gas trading cooperation between EEX and Powernext. In the framework of the cooperation, the trading participants can trade both exchanges natural gas products on a common trading platform, the Trayport Exchange Trading System (ETS). The launch of PEGAS forms a big step towards an integrated European Natural Gas Market, said Peter Reitz, Chief Executive Officer of EEX. The PEGAS cooperation is a response to the trading participants need for a consolidation among the trading platforms, emphasises Jean-Franois Conil-Lacoste, Chief Executive Officer of Powernext. From today, all Powernext Natural Gas Products (TTF Futures, PEG Nord Spot and Futures, PEG Sud Spot and PEG TIGF Spot) are tradable on the common PEGAS platform. All EEX products are also available for mapping and testing on the PEGAS server from 29 May onwards. EEX Natural Gas Products will be activated for trading in several stages, thereby guaranteeing a smooth migration of EEX Products to the new platform and giving trading participants sufficient time to prepare. EEXs 10 MW Natural Gas Futures for the GASPOOL market area will be transferred to PEGAS on 4 June, and therefore spread trading between the market areas of GASPOOL and TTF will be possible for the first time. Furthermore, the other EEX Natural Gas products (NCG Spot and Futures, GASPOOL Spot, TTF Spot and the related spread products) will migrate to the PEGAS platform within the next few weeks, subject to member readiness. About PEGAS Pan-European Gas Cooperation PEGAS is a cooperation between the European Energy Exchange (EEX) and Powernext. In the framework of this cooperation, both companies combine their natural gas market activities to create a pan-European gas offering. Members benefit from one common Trayport gas trading platform with access to all products offered on the exchanges: spot and derivatives products for the German, French and Dutch market areas. Furthermore, spread products between these market areas are tradable on the same trading platform. For more information: www.pegas-trading.com About EEX: The European Energy Exchange (EEX) develops, operates and connects secure, liquid and transparent markets for energy and related products on which power, natural gas, CO2 emission allowances and coal are traded. Clearing and settlement of all trading transactions are provided by the clearing house European Commodity Clearing AG (ECC). EEX is a member of Eurex Group. For more information: www.eex.com About Powernext: Powernext SA manages complementary, transparent and anonymous energy markets. Powernext Gas Spot and Powernext Gas Futures were launched on 26 November 2008 in order to

News from Data Vendors

hedge volume and price risks for natural gas in France and the Netherlands. In 2011, GRTgaz and Powernext launched the first gas market coupling initiative in Europe between PEGs Nord and Sud. Powernext owns 50% in EPEX SPOT and 20% in EEX Power Derivatives. For more information: www.powernext.com

OTC Global Holdings: Choice Natural Gas Hires Nicholas Ernst as Director of Weather Markets
Expands Leadership Team, Expertise Level to Better Serve Clients HOUSTON (May 30, 2013) Choice Natural Gas, a subsidiary of independent interdealer broker OTC Global Holdings (OTCGH), announced today the addition of Nicholas Ernst as director of weather markets. In this role, Ernst will facilitate global transactions for standard exchange traded products and highly structured transactions that combine both weather and commodity risk and complex weather variables. Choice Natural Gas and OTC Global Holdings have given me a new platform to expand my 11 years of weather markets experience, said Ernst. The companies commitment to growth and success, as well as their focus on maintaining boutique-style operations through partnerships creates a unique environment of collaboration that Im glad to be a part of. Prior to joining Choice Natural Gas, Ernst worked as the director of weather and catastrophic risk markets at Evolution Markets for more than 10 years. He also served in management roles at Enron and Bethlehem Steel. The addition of Nicholas to the Choice Natural Gas team reinforces our commitment to hiring professionals who understand the complex needs of our clients and can deliver the value added services required by todays rapidly evolving market, said Javier Loya, Chairman and CEO of OTC Global Holdings, the parent company of Choice Natural Gas. His hiring is also another example of how our aggressive business model, which is focused on bringing top-tier talent with niche expertise to our teams, further widens the gap between OTCGH and our competitors. Ernst is a graduate of Lafayette College, where he received degrees in engineering and economics. About OTC Global Holdings Formed in 2007, OTC Global Holdings is headquartered in Houston and New York, with additional offices in Chicago, Jersey City, London and Louisville. It is a leading independent interdealer broker in over the counter commodities and the largest liquidity provider to CME ClearPort and ICE Clear U.S. Through its subsidiaries the company holds a dominant market share in the U.S. and Canadian natural gas markets, the U.S. power markets, crude oil and crude oil options, crude oil products and crude oil product options, agricultural and soft commodities, as well as structured weather and emission derivatives. The company serves more than 250 institutional clients, including 45 members of the Fortune 500, and transacts at over 150 different commodity delivery points. To learn more about the company, please visit www.otcgh.com or go to http://bit.ly/OTC.

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In Depth

Coordination of Gas and Electric Industries: Increasing Transparency?

By Olga Gorstenko
Over the last decade, the electric power industry has been on an unprecedented rollercoaster ride throughout a whirlwind of market ups and downs, regulatory twists and turns, and environmental swings. It has gone through a series of major changes. Even at the best of times, each one of these changes could easily take a decade to develop completely. Meanwhile, we have witnessed so many things happen in very a short period of time that an inherently conservative power sector is being tested to the extreme limits of its tolerance. The unrolling of nodal markets, the strengthening of regulatory oversight on power trading activities, the smartening of the grid, and the birth of electric cars are just a few of the developments. Moreover, the generation stack has been and will continue to be impacted by government support of renewable generation and the tightening of environmental regimes, which lead to the shrinking of the traditional coal-fueled generation base (only AES Corp. announced that it will retire almost 1 GW of coal capacity by 2015). Many questions are also being raised over the future of nuclear-powered units. Compounding all these strains is an unprecedented growth in natural gas-fired generation that is leading us towards something completely new and almost revolutionary: the coordination and possible integration of both the natural gas and electric systems.

Growth of gas-fired generation

The prominence of natural gas-fired power generators has been on the rise. According to the 2012 ISO-NE report, the regions electricity during the 1990s was produced primarily by oil, coal, and nuclear generating plants. However in 2011, approximately 51% of the electricity in New England was generated by gas-fired units1. The growing number of gas-fired power units is explained by several factors. An increase in shale gas production has led to an abundance and falling prices for this fuel that makes the cost of operating natural gas power generators very attractive compared to that of other forms of generation. Adding to this factor, natural gas units offer one of the most flexible modes of operation, providing probably the best support for intermittent renewable power resources such as wind. Wind generation has increased dramatically over the last 10 years particularly in the West, Midwest, and Texas. This trend is expected to hold. According to the EIA, power generated from renewable resources will increase by 1.7% annually with total output doubling between 2010-2040 (as shown in Figure 1)2.

Figure 1: Renewable Generation, Reference Case

ISO New England, Addressing Gas Dependence, http://www.iso-ne.com/committees/comm_wkgrps/ strategic_planning_discussion/materials/naturalgas-white-paper-draft-july-2012.pdf 2 EIA Annual Energy Outlook 2013 http://www.eia.gov/forecasts/aeo/IF_all.cfm#natural_gas

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In Depth

Coordination of Gas and Electric Industries: Increasing Transparency?

However, being able to accurately predict when the wind will blow is difficult with a high level of certainty. While many resources have been dedicated to develop forecasting models that are supported by sophisticated monitoring equipment, we are still far away from having a solution that lets us know at what particular moment wind generators will go online and how long they will produce energy. Electric storage, a seemingly reasonable solution to renewable generation variability, is nowhere near to being a large-scale, costeffective commercial implementation even with both the number of technologies available and the government support behind it. Regions blessed with plentiful hydro resources use hydro power to balance their load profiles. However, even hydropower-rich regions can be limited in their capacity to balance power generation intermittency since run-of-river projects have limitations to their dispatchability. Pumped-storage hydroelectricity (PSH) is based on the principle of using stored water pumped from a lower elevation reservoir to a higher elevation to generate electricity. Electric power is used to run pumps moving water to the upper reservoir during cheaper off-peak hours. The water is released through turbines to produce electric power during peak hours. PSH is a better alternative to run-of-river projects in terms of balancing wind generation because its operation can be very flexible. This type of generation is largely limited by geographic landscape. Some research has been done to investigate using underground reservoirs such as former mines for PSH projects. However, the placement of such projects is defined by location issues and high costs. Given all these hurdles, natural gas remains the key solution for renewable power intermittency. One important factor is the speed by which natural gas plants can be started when demand is high. Some gas turbines can cold start in five minutes. Natural gas units are facing more significant changes than just a growth in their number. Coal-fueled power generators are under immense pressure from environmental regulations, and are being replaced by gas units. With these shifts, gas units will provide not only balancing, peak-hours support, but will also take on more base-load functions. The majority of new North American installed capacity projected for the next 10 years will be fueled by natural gas. According to the NERC, this trend will constitute 45 GW of planned and an additional 48 GW of conceptual capacity3.

Interdependency of gas and electricity

Electric power has already become the natural gas industrys largest consumer. This trend will sustain and even expand. The electricity industrys dependence on natural gas delivery systems will only increase. Power generators are assuming a larger share in the generation stack and will compete with other customers for capacity on natural gas pipelines. Competing interests create conflicting situations when demand for both commodities surge. This issue becomes even more apparent during weather-related events such as hurricanes, but especially during sudden drops in temperature known as cold snaps. As customers of the natural gas industry, electric utilities are much more difficult to manage relative to residential, commercial or even industrial classes. Electric generators can adversely impact pipeline reliability in a number of ways: - Electric units represent very large loads and so any change in demand from them results in major setbacks to the pipeline operations. - Pressure requirements for electric loads are much greater than those for other consumers. Any reduction in production, such as a sudden loss of a large generator, causes immediate pipeline pressure drops and can reduce the quality of service to other pipeline customers and other generators. - Gas-fired generatorsmostly remaining on the marginare subject to significant variation as a result of weather events, unplanned outages or balancing requirements for renewables. Fluctuating gas supply requirements coming from multiple load points affect pipeline performance. Natural gas affects electricity as well. More pressure is being put on the power sector by the growing utilization of electric compressors that maintain pressure in pipelines. Cold weather can cause the shutting off of pipeline electric compressors, thereby leading to a decline in gas pipeline pressure. The drop in pressure negatively affects the supply of fuel to the gas-fired electric units. If electric units do not have booster compression, they can trip lowering overall power supply. A reduction of the power supply can lead to failure of additional electric compression and cause further pipeline pressure drops followed by even larger electricity failures.

Pipeline electric compressors shut off

Pipeline pressure drops

Gas supply to power generators drops

Power generators trip

Electricity supply drops

More pipeline electric compressors shut off

Pipeline pressure drops more

Electricty supply fails

Figure 2: Disruption of Electric and Natural Gas Systems from Cold Snap
3

NERC 2012 LTRA Emerging and Standing Issues Templates http://www.nerc.com/comm/PC/Reliability%20Assessment%20Subcommittee%20RAS%20 DL/2012_Issue_3_GasE.pdf

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In Depth

Coordination of Gas and Electric Industries: Increasing Transparency?

Given the interconnected nature of the power supply, such a sequence of events can easily turn a disruption on one gas pipeline into power delivery disruptions over more than one region. Indeed, weather events have already demonstrated the potential severity that of shortfalls of one commodity can have on the other. Gas curtailments caused drops in generating capacity in 1989. During the 2003 cold snap, disruptions on gas pipelines in Texas had a significant impact on generating capacity that sent electricity prices through the roof (see Figure 3). current status of gas-fired generation and its future development in each particular region. The states that account for the majority of electric sector gas consumption are further along in optimizing the coordination between the gas and electric industries. Regions that are increasing their use of natural gas because of the growth in renewable generation are mostly concerned with any misalignments between these sectors.

Differences in Pipeline and Electrical System Operations

While infrastructure inadequacy is an important concern, an even more serious problem arises from non-aligned communication and operational processes that have been a nagging issue for market participants of both sectors. Communication FERC mandates that communication protocols be established between interstate pipelines, power plant operators, and transmission owners/operators. This communication, however, is mostly limited to emergency situations.The reality calls for more information to be shared by both industries to ensure reliable operations and consistent planning processes. Some examples include maintenance schedules and outages, planning of new facilities and perceived impact from them, loads, and forecasts. Long-term planning has to be integrated into the counterpartys forecasts. Communication between the two industries is an extremely sensitive issue. Deregulation of both sectors has created this difficulty. Almost every piece of information on operations that has some economic value becomes proprietary information. Unbundling the gas system during the 80s and electricity in the 90s has added several layers of business to two operational modes. Increased segmentation and the number of market participants, another spillover effect from deregulation, adds to the growing complexity. The majority of the regions, especially those with a high saturation of market-based business operations, face more resistance from different parties concerned with the loss of competitive advantage as data is shared. Resource Adequacy Planning Resource planning approaches differ between the natural gas and electric systems, thereby creating friction when it comes to aligning resource adequacy practices. Industries are in agreement that the growth of gas-fired generation has to be considered in pipeline infrastructure planning in order to ensure that increasing capacity requests can be met by pipelines. These changes are not so easy to implement.

Figure 3: ERCOT Daily Electricity Prices (Created with ZEMA)

A cold snap in February 2011 triggered 210 generating units in ERCOT to experience an outage, a derate, or a failure to start resulting in rolling blackouts affecting 3.2 million customers. Electrical disruptions in ERCOT also caused gas curtailments in New Mexico, Arizona, and parts of Texas that were outside of the ERCOT system. The event prompted an examination of the disruptions causes by the NERC/FERC Task Force. The investigation focused on whether the gas supply shortage caused the electricity production failure. The results showed that outages and derates in winter 2011 were caused by 30% production shortfalls in the Permian and Fort Worth basins, but were mostly due to electric equipment failures caused by below-freezing temperatures. A growing interdependence between the natural gas and electric industries has led to FERC starting an initiative in 2012 to improve coordination between the two sectors. The Commission is continuing to study the issues and is releasing quarterly updates. the discussion has even been brought to the attention of the U.S. Congress with two hearings held in March 2013. The preliminary results show that gas-electric interdependence concerns are more acute in certain regions. In some jurisdictions, this coordination is a novice concept while for others it has already been thought over, implemented and is being adjusted as the need arises. This difference depends in large part on the

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In Depth

Coordination of Gas and Electric Industries: Increasing Transparency?

Electrical transmission system owners have almost no control over the size and location of the electric loads or the timing of electricity use by customers. Transmission systems are not planned using the firm commitments from the future users, but on the rather speculative estimates of anticipated load growth. Proposed transmission lines do require certain pledges from major users sought through simulated Open Seasons. These simulations are run in the course of receiving regulatory approval for the project. However, the results of simulated contract solicitation do not constitute a basis for committed contracts. To balance out the lack of real commitments, the grid is designed to be a very flexible system with multiple parallel paths for electricity flow capable of serving numerous nodes, and where facilities are interconnected to withstand serious contingencies. Under such a design, customers rarely lose power because of a problem on the bulk power system. Natural gas system planning is less flexible. The standard industry practice is to expand pipeline capacity based on firm contracts. FERC generally does not authorize new pipeline capacity unless customers have already committed to it (that is, firm delivery contracts). Pipelines are prohibited from charging the cost of new capacity to their existing customer base. New customer requests for firm service are considered when pipelines add new facilities or improve existing facilities. As a result, pipeline capacity closely matches the requirements of the firm customers. Pipelines know the exact location of the customers who have firm rights, and have contracts in place that describe exactly how much firm capacity each customer may call upon. However, if all of the pipelines firm customers use their full capability, little or no excess pipeline capacity is available. Unlike power transmission, pipelines do not have contingency planning standards. There is some redundancy in the pipeline system: pipelines use side-by-side pipelines, or loops, that provide support in cases of maintenance or loss of integrity. However, these structures are not sufficient to increase gas flow in any dramatic volume. In regions with deregulated electric markets, natural gas-fired generators rely more heavily on pipeline capacity release and interruptible services. In fact, most gas-fired units have difficulty committing to firm service since the majority of them serve mid-range and peak demands. While this trend is expected to change with the pending retirement of coal-fired units, thus forcing more gas units to serve base loads, current energy profiles make it difficult for gas-fired units to commit to firm pipeline capacity. Therefore, new power generators find it difficult, if not impossible, to be integrated into gas pipeline expansion plans. Scheduling A major misalignment between the two industries exists in daily planning procedures, the daily nomination process (also referred to as Gas Day and Electric Day). Gas Day Nomination of gas volumes (supply and transportation) is usually very granular and includes several intraday adjustments known as bumping rules. When a pipeline cannot fulfill all requests, it allocates capacity according to nomination priorities. Priorities are set in the following order: primary firm: the highest priority of service with nominations of firm transportation service from primary points of receipt to primary points of delivery secondary firm service: the next in priority with nominations from alternative or additional secondary receipt or delivery points interruptible service: the lowest priority The typical nomination process milestones are: Timely Nomination Cycle (10:00 a.m. 4:00 p.m. of a day before the gas flow): shippers submit nominations to a pipeline for the next days volumes to receive firm, secondary or interruptible service, and the pipeline fills these requests on basis of priorities Evening Nomination Cycle (6:00 p.m. 10:00 p.m. of the day before the gas flow): revisions to nominations the dayahead. Primary firm nominations can bump secondary firm nominations until the end of the Evening Nominations Cycle

NERC Reliability Standards require a layer of system backups to cover a scenario called a single contingency situation. Such backups have to ensure that no failure of a single piece of equipment (for example, a transformer or a large generator) will cause a loss of power. Known as N-1 (N minus one), these mandatory single contingency scenarios are frequently supplemented by enhancements involving two (N-1-1) or more equipment failures. Some planners introduce additional standards that require handling extra contingencies such as extreme weather conditions (referred to as a 90/10 load), the outage of the critical generators, limitations on the use of peaking generation units, and so on.

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In Depth

Coordination of Gas and Electric Industries: Increasing Transparency?

Intra-Day 1 (10 a.m. of the day of gas flow 2:00 p.m. of the gas flow day): another opportunity for revisions. Firm nominations can bump interruptible nominations until the end of the Intraday 1 cycle Intra-Day 2 or No-bump Cycle (5 p.m. 9:00 p.m. of the day of gas flow): the last revisions to the gas flow. Primary and secondary firm nominations cannot bump already scheduled interruptible service (referred to as the no-bump rule) Pipeline delivery service for firm service typically contains a fixed monthly charge for reserving capacity that can be difficult to recover by peaking power generators because peakers have unpredictable production schedule and usually purchase an interruptible gas delivery service. However, such a service can be unavailable during weather events when firm customers call for full reserved capacity, thus leaving almost nothing for interruptible service. Yet these are the times when peakers are going to be called on. If a generator served by interruptible transportation has no alternative source of fuel or storage, it might not be available for power generation at such peak times. Electric Day While there are some differences among markets, the traditional electric day extends from midnight to midnight. Electric utilities submit information to the balancing entity, such as a power pool or ISO/RTO, on the units that can be available to generate power. The balancing entity prepares projections of anticipated electric load for the whole balancing area for the next day, and selects which electric power units should be used to meet the load projection for the next day. The decision as to what units is made on the basis of efficiency or an economic dispatch, which is allocating the load expectations between generation units should be used so that the cost of operation is minimized. Economic dispatch order, however, can be somewhat distorted when specific types of generators are required to be producing electricity regardless of economic merits. An example is where renewable resource generators are expected to run whenever weather conditions permit (the wind blows, sun shines, and so on) so that they meet state standards for the minimum amount of power required from renewables, or Renewable Portfolio Primary Firm Standards.
Secondary Firm Interruptible

GAS DAY
Nomination Requests Received
Primary Firm Secondary Firm Interruptible

Primary Firm Secondary Firm Interruptible

Intraday 2

Real-time flow Real-time flow

Intraday 1

Evening Nomination Cycle Timely Nomination Cycle

12:00 PM 12:00 AM 6:00 AM 6:00 PM 12:00 AM

Real-time flow

Real-time flow
12:00 PM 6:00 AM

Evening Nomination Cycle

6:00 PM

Forecast and Unit Commitment

Real-time dispatch

ELECTRIC DAY
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Dispatching Order Set

Figure 4: Misalignment of Natural Gas and Electric Scheduling

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datawatch May 2013

In Depth

Coordination of Gas and Electric Industries: Increasing Transparency?

The balancing authority then determines the dispatching order of units and confirms it with generators. The electric day planning is generally completed by 6 p.m. of the current day, and this is where the discrepancies begin. Since the pipeline deadlines for nominations is 10:00 a.m. of the current day, power units have to schedule their gas nominations with pipelines eight hours before the time when the balancing authority confirms the dispatching order. Therefore, power units must base their requests for gas on estimates rather than a confirmed power schedule. This discrepancy creates fuel-procurement risk, particularly for large generators. Sudden weather events that raise demand increase this risk. In these situations, pipelines frequently cannot accommodate changes to capacity requests. The core problem is that the standard gas nomination schedule does not allow generators to revise their nominations as needed in order to balance electric loads. compressor stations, maintenance outages on both systems are informally coordinated between major. Several regions are developing practices to improve coordination and communication between the industries not only during emergency situations, but also under normal operational conditions. In 2012, the New England States Committee on Electricity established the Gas-Electric Focus Group to examine the challenges arising from industries interdependence. ISO-NE has taken the lead by improving the lines of communication, and has been advocating the concept of allowing the sharing of real-time electrical operational information with gas pipeline operators. The regional group is studying the adequacy of supply system, supplemental procurement for natural gas, liquefied natural gas, and back-up oil. MISO formed the Task Force in 2012 to work on general gaselectric coordination issues, which are expected to emerge in the region with the pending retirement of approximately 30,000 MW of coal-fired generation in 2013-2015, likely leading to a greater reliance on gas-fired generators. MISO has been proactively searching for solutions to these pending challenges. As well as enhancing communications protocols, MISO is looking into sharing information during electric contingencies that could affect pipeline operations. It is also consider sharing information at hourly generator commitments so that pipelines would know in advance which gas-fired generators need to be run. CAISO has amended its tariff to enhance communications with the gas industry. The organization now shares outage information with natural gas pipelines for their use in coordinating, planning, forecasting, scheduling outages, maintenance, repairs, and curtailing pipeline or storage systems. CAISO discloses the names of individual natural gas-fired generators needed to support reliability in the event of a natural gas shortage, natural gas pipeline testing and maintenance, and other curtailments of natural gas supplies. Scheduling Misalignment of gas and electric scheduling practices, as well as the application of the no-bump rule and pipeline capacity release rules, are under the most intense scrutiny. It has been recognized that scheduling issues are interrelated, and that any change has to be implemented in a way that makes sense for both industries. Prior efforts of NAESB participants failed to create a unified gas and electric timeline, revisions to the gas nomination schedule that permit additional intra-day changes or to eliminate the no-bump rule. However, the accelerating urgency has pushed several RTOs/ISOs and some pipelines to modify services and patch scheduling discrepancies. Several pipelines have adopted transportation services developed specifically for the electric utility sector. Some pipelines have instituted new

Mitigation: what has been done and yet to be done

Uncertainty in forecasting the amount of gas required by a generator will remain high as long as natural gas continues to be the marginal fuel for the electric power system. Given that weather forecasts are less than perfect, natural gas requirements for any given electric utility or system operator will remain dynamic. However, what type of changes is needed in either industrys framework is not a straightforward answer. It is generally agreed that communications improvements could be made on a regional basis. Electric scheduling practices, resource adequacy, and reliability issues are often tied to a region, and can be refined within each particular region. On the other hand, changes to gas scheduling rules may require coordination on a national level. Communication The process of sharing information is aligned among entities inside each industry. Pipelines already exchange information with other pipelines on transportation nomination requests to coordinate flows between each other. Power transmitting entities share eTags, scheduled transmission interchanges, and other operational data that ensure the reliable transmission of electric power across a region. As far as the exchange of data between two industries goes, a great deal of work needs to be done. Regions with historically well-developed pipeline systems and high penetration of gas-fired generation seem to have little or no concerns over growing this type of capacity. Therefore, communication between the Southeast regions major electric entities and pipelines has beenaccording to market participantsadequate in addressing reliability concerns for both day-to-day operations and during emergencies. Gas and electric entities share the locations of electric-driven natural gas

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datawatch May 2013

In Depth

Coordination of Gas and Electric Industries: Increasing Transparency?

classes of premium services to accommodate for the fluctuating nature of gas loads. So-called firm no-notice transportation service, usually the most expensive one, allows shippers to receive delivery of gas on demand up to the firm entitlements on a daily basis without incurring penalties. Firm customers can then meet unexpected fluctuations in demand. Texas Gas Transmission LLC allows firm shippers purchasing Enhanced Nominations Service to have eleven nomination cycles a gas day. Eliminating the no-bump rule has been discussed by both industries. Generators with firm services complain that the nobump rule impedes their flexibly. However, groups consisting mostly of industrial users are supporting preserving the nobump rule. For them, eliminating the rule could cause fewer interruptible customers resulting in lower utilization of pipeline capacity and a larger share of fixed costs allocated to firm shippers. Some power entities have been very flexible in adjusting their processes and refining scheduling requirements so that information becomes available a few hours earlier in the traditional electric day. NYISO and ISO-NE consider ways of changing the schedule of the day-ahead unit commitment process to better coincide with the gas timely nomination cycle. ISO-NE is proposing to allow hourly offers and intra-day reoffers in the real-time energy market so that generators can adjust their bids to reflect changes in fuel costs. As a transitional move, ISO-NE will adjust the electric market day-ahead scheduling as well as the resource adequacy assessment process under which day-ahead awards may be released prior to the start of the electric day in advance of the standard nomination deadline for gas pipeline capacity. NYISO already releases its day-ahead dispatch results at 10 a.m., which allows NYISOs gas-fired generators to be better informed for the first timely pipeline nomination cycle. MISO is reviewing the potential for aligning market schedules by clearing the electric market earlier in the day. These efforts, while solving or at least addressing concerns on the regional level, do not provide industry-wide solutions. Whether it has to be moved to the national level yet to be determined. Storage and Fuel Switching Capabilities The electric industry has been using different methods to mitigate scheduling discrepancies. Gas storage is one of those options for the power plants or utilities that cannot economically justify entering into firm contracts with gas suppliers. Natural gas storage, particularly salt dome storage with multiple cycle capability, offers a solution to swing-load requirements. Storage facilities can be owned and operated by an electric utility that enables the operator to manage its own swing requirements. Given a high price, a more common case is where storage capacity is owned by a pipeline or a gas marketer. In this case, trading entities control facilities and charge a fee for providing services; this makes the access to the storage more challenging. Building more natural gas storage facilities can solve issues of fluctuations in gas demand. Another option is to equip power plants with alternative fuel options that can be stored more easily than natural gas. Many simple or combined cycle combustion natural gas-fired power plants have dual-fuel units. Usually some type of fuel oil serves as an alternative source. Fuel switching can be a simple or complicated process. Some gas turbines can switch fuels in just a touch of a button. Other units require replacing gas injectors with oil injectorsa process that can take longer than a day. The decision on whether to perform fuel switching depends on several factors: reliability cost availability of fuel environmental restrictions (air permits)

Fuel switching was the preferred option when the relative prices of gas and oil fluctuated, thereby offering various economic opportunities for power producers at any point of time. With consistently low natural gas prices and growing disparity between the two prices, power operators have less motivation to maintain this capacity as generating electricity from fuel oil can be double the cost of using natural gas. Switching to fuel oil becomes even more expensive since environmental and air quality restrictions, which differ by state, set limits on how many hours per year a generator is permitted to run on fuel oil. Violations bear fines, and in combination with growing fuel costs, the value of maintaining fuel switching capability is being diminished. Indeed, the mounting costs of using fuel oil restrict its usage to only emergency situations where it is the only option to guarantee the reliability of power generation. Incidentally, system reliability has the highest priority for operators; and, if a unit has to be online to ensure the uninterrupted generation of electricity, it will be put online regardless of the price. Some regions, such as the PJM and NYISO markets, already provide incentive or requirements for dual fuel. The PJM Reliability Pricing Model even uses a dual fuel reference unit to determine the Cost of New Entry for the wholesale electric capacity market demand curve that is used to set the capacity price. In NYISO, generators in New York City and Long Island are required to have alternate fuel capability under state reliability requirements. Discussions are being raised on whether government subsidies and incentives should be instituted for such generator types. Another consideration is the issue on whether fuel switching capabilities should be added to those gas units that do not currently have it, and whether generators already having these options installed should be required to maintain this capacity.

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datawatch May 2013

In Depth

Coordination of Gas and Electric Industries: Increasing Transparency?

Growing interdependence of the two industries is a new actuality and both sides are learning how to adapt and mitigate as the events unveil. Regions, already saturated with natural gas-fired generation, turn out to be more prepared for the trend. They even insist that no nation-wide coordination or interference from the FERC level is needed or productive. These voices may be decisive. Adjusting scheduling practices and adding more flexibility seems to be a project of gigantic proportions; however, it does not seem to bring in as much debate as the issue of sharing information between industries. The need for expanding data sharing across the markets is not being contested by either party. The repeatedly raised argument is: How far beyond what is already being publicly posted should the entities unveil to their counterparties? This will likely mean we will see more data in public domain. Most entities will try to mitigate among themselves by sharing data under confidentiality agreements. Regulators will probably accept the idea as an ultimate solution. Maybe not in the near future, but at some point in time, we will see more information reported on public platforms. It looks like a common tendency: the more complexities and problems arise in some industry, the stricter the regulatory oversight is getting and more transparency is imposed by the authorities increasing requirements for the public reporting.

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