EUGASMARKET
NH: And the Commission, presumably, is quite comfortable NH:Hastheliberalisationprocessledtoasignificantincrease
withthat? inspotgastradinginEurope,andthedegreetowhichmarkets
HH: I think that the Commission does not have a market are now legally and practically open to competition? Heinrich,
design ambition in this area. wouldyousaythemarketisalongwayfrombeingopenatthe
OM: But nevertheless, from an exchange point of view, of moment?
course it would be interesting to have more transparency HH: Well, I mean there is a reason why the Commission pro-
because of the fact that such large volumes are going through posed and insisted on ownership unbundling, which is seen as
these broker platforms. At least there should be a minimum of the cleanest solution to address the conflict of interests within
transparency in those markets as well. a vertically integrated company. The Commission is pushing
very hard to put measures and guarantees in place which save
and protect the independence of TSOs, and that’s where we
are heading to and what, in the end, will need to be gained out
of the ThirdPackage.
CL: Well, let’s hope that the ThirdPackage does get approved
soon and that it has in it the things that will open up the mar-
ket and give, in particular, people access to capacity across
Europe, because that is probably the fundamental problem. We
have, legally, the whole of Europe opened up to competition but
imagine the gas pipes crossing Europe like a big motorway, and
all three lanes on this big motorway are reserved for some big
Peugeots and BMWs that are blocking the route. And the new
Oliver Maibaum, EEX
entrant is in his Mini on the hard shoulder. “It’s an open market”
and these big cars say, “but we were here first”. That’s the sort
NH: What would the minimum be? What would you want to of situation we have with the gas and the capacity, and to make
know? matters worse, the guy in the sports car, going along the hard
OM: Trading volume, a clear picture on what is the total mar- shoulder, trying to sort of actually get across Europe, is then told
ket size. At least the big OTC broker platforms are obliged to that when he reaches a junction that he has to close his eyes
publish the overall volume based on every contract, like we do. because there's no transparency at all.
JW: So would you do that on a monthly basis? OM: I pretty much can agree with what Colin said. I think it’s
OM: At least a monthly basis. important that we have the same speed in the liberalisation
JW: Because I think they have annual reports. process. This is one of the main challenges for the EU to get
OM: They have annual reports but they are highly aggregat- these markets based on common rules, based on the EU legis-
ed. So at the end you can’t read anything out of it. And I know lation, to get it actually working.
that they are also FSA regulated, that they have to send large
customer reports to the FSA but those reports are not public. At NH: That’s clearly common ground. Let me ask two final
least I would find it interesting to make some analysis, how big questions. We’ve talked about fragmentation of markets. Is
is the market and how much volume is going through the mar- that exacerbated by the fact that there are too many
ket and at what price level? So if we do price analysis we have exchanges?Dothereneedtobefewerexchanges?
the opportunity, at least, to compare with the OTC. OM: No, I think basically you’re right. If you look at the land-
scape of exchanges in Europe you will find an enormous num-
NH: Youhaveasecondsuggestion? ber of different exchanges, clearing houses, etc. And I think the
OM: It’s prices. This is the other issue, volumes and prices. approach is actually not to do with competition but being open
That’s basically what we would be interested in, and I think for cooperation, and when we talk about cooperation we main-
also the rest of the market, because not every trading house is ly talk about cooperation in the clearing business, so this
actually using all the brokers. If you’re a member of one of enables all the major exchanges to cooperate with us [EEX].
these broker platforms, of course you get the information They can still exist and they can still take care on their individ-
because you're part of the community. But you never have the ual member bases.
total picture. CL: We would certainly support the development of
exchanges through cooperation but we would hope there are
NH: It’snotgoingtobeverypopularwiththebrokers,isit? also competitive forces on them as well … What we certainly
OM: Probably not. shouldn’t do is legislate to say that there can only be one
CL: What price information would you publish? I mean, I can exchange in this area here, and unfortunately there are some
see there would be a value to the trading community of having countries in Europe that have already done that and it has
volume information made available to everybody every month. become a constraint, particularly on cross border trade,
OM: I think they already have some price information on because who is responsible for trading capacity at the border?
their platform. They calculate a daily average, weekly aver- Can Germany constrain a Dutch exchange from offering a
age, monthly average, or whatsoever of the price. The end product on the German/Dutch border?
of day prices I think is interesting to see how the price lev- NH: We’ll leave that one hanging in the air. Thank you very
els develop. muchindeedtoallofyouforyourcontributions •
74 SEPTEMBER 2000 COMMODITIES NOW
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