Who can participate?
Any trading parties
Service Description
In meeting forecast energy requirements at minimum cost National Grid trade energy related products forward in time (i.e. in advance of the Balancing Mechanism). There are three general categories of energy related products that National Grid purchase:
- Power Exchange Trades
- Forward Energy Trades
- Energy Balancing Contracts
Power Exchange Trades
Power Exchanges are electronic trade matching systems where participants enter prices at which they are prepared to buy or sell electricity at. The exchange automatically matches like prices/volumes and the trade is done. This is an anonymous process with the Power Exchange effectively becoming the counterparty to the trade. Standardised products are available on Power Exchanges and range form half-hourly contracts, available for the current day and day ahead (tradable 24 hours a day), to season contracts that cover six month periods. In between these are contracts for quarter year, months, weeks, days and within-day denominations.
Forward Energy Trades
These are bilateral contracts negotiated between counterparties and unlike Power Exchange contracts can be tailored to suit the requirements of the individual parties. For example it would not be possible to enter in to a trade for the first 6 hours of every week-day for a month on a Power Exchange since this is not one of the standardised products. However, if two parties are in agreement, then such a contract could be negotiated ‘over the counter’ (OTC). As well as negotiating direct with a counterparty trades can be negotiated via ‘Brokers’. These may at times include BMU-specific or locational terms.
Energy Balancing Contracts
Energy Balancing Contracts are agreements for services that are procured for the purpose of energy balancing. Energy balancing contracts are primarily required as a result of plant losses and shortfalls.
Procurement Process
A Grid Trade Master Agreement (GTMA) is required to be in place to manage the trading relationship between Counterparties.
Commercial Service Agreement is established for Energy Balancing Contracts.
Payment Structure
Energy trades are priced in £/MWh.
BSAD: Energy related products are included in the calculation of BSAD.
ABSVD: Not Applicable.
Summary of Further Information
The details of PGBT Offer and Forward Contracts can be found through the link below: