"Energy Trading Today"
An interview with Hugh Brunswick, Chief Executive Officer, Equias B.V.
A lot of new developments and concerns have sprung up in the energy trading industry today and we wanted to go in deeper to find out what certain areas have been affected such as the technology landscape and the regulations. We had a recent chat with Hugh Brunswick, CEO at Equias to get his views and share some insight.
Join us in the interview below with Hugh:
Looking at the technology landscape and offer in energy trading today, what would you say are the areas of improvement?
The shape of the market has been changing for some time as a result of renewable policy and smart grid development both of which have been putting pressure on the big utilities and opening the door to the so called 'prosumer', moving away from a market dominated by a few large players towards a market with a smoother profile comprising a greater number of small and medium sized participants. Consequently, there is a need to facilitate wider access to trading technology and easier access to the market. Blockchain is one technical solution that can be seen as reflecting this on-going change as it seeks to democratise access to IT services through its decentralised technical architecture, as opposed to the traditional centralised architectures best exemplified by exchanges and clearing houses which can be perceived as promoting an 'ivory tower' mentality of the haves and have nots in the market. However, blockchain has so far failed to live up to the hype and suffers from limitations defined by the natural laws of physicals: that a distributed architecture can never process the volumes of data that a centralised architecture can, a critical limitation as volumes grow and matching rates increase. A middle way is required that brings technology, automation and market access to the small and medium sized participant but which combines the benefits of decentralisation with those of centralised architectures.
Regulations have been a real driver to achieving efficiency in the back office. What other areas are also benefitting from this? What do you think will be the future driver?
I would not claim that regulation has delivered efficiencies so far, however I do agree that regulatory reporting has meant that the vast majority of transactions are now reported in a common format, at least this is true for transitions eligible for reporting under REMIT. This has created a huge natural industry data resource. As with any natural resource it can be processed and refined to become useful, raising the possibility of wider access to information and the insights flowing from it, lowering the barriers to active participation in the market, leading to increased activity and participation which is good for the whole market.
Equias (formerly known as EFETnet) will be a sponsor at ETOT next month. Could you tell us what motivated your choice in getting a higher involvement this year?
We're interested in getting the new name across, emphasising that while Equias remains true to its roots in operating and in developing industry standard back office processes that deliver efficiencies and cost savings to the whole market, that Equias has a degree of additional flexibility to develop new innovative services that seek to reduce barriers to market participation for small and medium sized traders and to democracies access to information where this facilitates greater market activity to the benefit of all market participants.
Equias will be present at the 10th ETOT Summit this October in London. To learn more about Equias, please click here or visit www.equias.org