1. FINGRID ELECTRICITY MARKET DAY
28 April 2015

2. NASDAQ COMMODITIES PRODUCT OFFERING
2
EXISTING PRODUCTS
POWER
• Nordic
• German
• UK
• Dutch
• El-Cert
EMISSIONS
• EUA
• EUAA
• CER
GAS
• UK Gas
• Spark
spreads
FUTURE DEVELOPMENTS
• Nordic futures
• Average Rate
future/options
• Continental energy markets
• Steel
• Coal
FREIGHT
• Dry
• Tankers
• Fuel Oil
• LPG
• Iron ore
SEAFOOD
• Salmon

3. THE NORDIC POWER MARKET

4. NASDAQ COMMODITIES
The most liquid power market for 20 years
4
OMEL
Powernext
Opcom
GME
POLPXEEXAPX-ENDEX
Belpx
PXE
EXAA
OMIP
HUPX
Borzen
EPEX Spot
2014 Nasdaq Commodities
Members 120 Exchange/ 390
Nordic Power
Turnover
vs
Consumption
Underlying value
€ 45 billion
Exchange
vs
OTC
61,6 %
TC
38,4%
NOMXC
61,6 %
OTC
38,4%
+1 500
400
TWh
4
Nordic Power: 95% of all power derivatives are cleared
58% 42%
Nasdaq
OTC
financial
physical

5. CLEARED VOLUMES NORDIC POWER
0
500
1 000
1 500
2 000
2 500
3 000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Cleared volumes Nordic Power Yearly 2005-2015 (TWh)
On Orderbook Off Orderbook
Low volatility
Low prices
Oversupply
Funds and banks exiting
Regulations
Political influence

6. NORDIC POWER – PRODUCT STRUCTURE
Reference Price for Nordic Futures and DS Futures:
NORDIC SYSTEM PRICE
Currency: EUR
Tick size: 0,01 EUR/MWh
Min contract size: 1 MW * h in the contract
Electricity Price Area Differential (EPAD, formerly CfDs)
AREA PRICES – NORDIC SYSTEM PRICE
EPADs
Deferred Settlement Future
(DS Future, formerly
Forward)
Cash settlement, only in delivery
period
Note: Years are cascaded to quarters, and
quarters to months.
Q1* Q2* Q3* Q4*
JAN | FEB | MAR
YEAR*
APR | MAY | JUN JUL | AUG | SEP OCT | NOV | DEC
W W W W W
D D D D D
Futures
Daily cash settlement mark to
market

7. ELECTRICITY PRICE AREA DIFFERENTIAL (EPAD)

8. ELECTRICITY PRICE AREA DIFFERENTIAL (EPAD), FORMERLY CFD
• Congestions between different areas
can result in different area prices
• Nordic ENO Futures and DS Futures
contracts do not fully cover the price
area risk
• This lead to a poor matching between
the compensation from the DS Future
and the real power price
• Market players need the instrument
EPAD to hedge against deviations
between the local area price and the
common Nordic system price

9. NASDAQ EPAD PRODUCT OFFERING
Price area Weeks Months Quarters Years
Oslo, Tromsø, Copenhagen, Århus , Tallinn and
Riga
N/A 2 3 3
Stockholm, Luleå, Sundsvall, Malmö, Helsinki
5 4 4 4
9
EPAD:
Example: SYHEL= Helsinki ΔP = Helsinki area price - system price
Market makers in the Nordic power market:
• Vattenfall: Nordic Base (full curve), Swedish EPADs and Helsinki
EPAD (not weeks)
• Dong and Energi Danmark: Danish EPADS
• RWE: Nordic Base (full curve), has withdrawn from quoting
EPADs
• Latvenergo and Lietuvos Energijos: Riga EPADs

10. NORDIC POWER VOLUME 2014
Risk Group Type On Orderbook (MWh) Off Orderbook (MWh) Total Cleared (MWh) Part of Total Cleared
ENO Base DSFutures 826 789 717 499 816 560 1 326 606 277 88,6%
EPAD-Stockholm DSFutures 5 399 656 47 703 676 53 103 332 3,5%
EPAD-Helsinki DSFutures 4 019 747 40 231 683 44 251 430 3,0%
ENO Base Futures 17 436 086 3 703 011 21 139 097 1,4%
ENO Base Options 14 965 080 14 965 080 1,0%
EPAD-Århus DSFutures 4 823 812 6 326 089 11 149 901 0,7%
EPAD-Malmö DSFutures 1 821 973 5 928 777 7 750 750 0,5%
EPAD-Copenhagen DSFutures 3 683 048 3 991 555 7 674 603 0,5%
EPAD-Sundsvall DSFutures 1 082 897 3 097 887 4 180 784 0,3%
EPAD-Luleå DSFutures 1 101 389 1 561 761 2 663 150 0,2%
EPAD-Oslo DSFutures 94 394 1 293 362 1 387 756 0,1%
EPAD-Tromsö DSFutures 570 899 812 132 1 383 031 0,1%
EPAD-Tallinn DSFutures 11 040 253 050 264 090 0,0%
EPAD-Helsinki Futures 35 112 119 655 154 767 0,0%
ENO Peak DSFutures 73 896 73 896 0,0%
EPAD-Riga DSFutures 21 886 21 886 0,0%
EPAD-Stockholm Futures 3 360 12 600 15 960 0,0%
EPAD-Luleå Futures 1 680 1 680 0,0%
EPAD-Malmö Futures 1 680 1 680 0,0%
EPAD-Sundsvall Futures 1 680 1 680 0,0%
EPADS represent 9 % of total cleared volume in 2014.
The historical figure has been in the range of 6.5 – 9 % (2008-2014)

11. IMPLEMENTATION OF PTRS AND FTRS COULD
THREATEN THE NORDIC POWER MARKET
MODEL

12. STATUS
Transmission rights have limited value for hedging
purposes, where liquid and reliable day-ahead prices are
formed at both sides of a (congested) border.
Nevertheless, the lack of EPAD-sellers and the wide spread
in some priceareas in the Nordic power market, makes it
hard and costly for suppliers to enter markets, where they
do not have physical production.

13. CONCERNS
• The European NRAs should be given the possibility to choose their preferred hedging
instrument
• An FTR is purely financial settled and should be classified as a financial instrument with
the same terms for trading and clearing as similar hedging instruments (EPAD)
• Introducing PTRs/FTRs in the Nordic market may split the liquidity between FTR/PTR and
EPADs
• Establish a monopoly for organizing auctions and a (secondary market) for FTR/PTR
is highly questionable
• Expected that only a few participants may participate in the PTR/FTR auctions
• The Nordic TSOs have been given an exception from auctioning of FTR/PTRs.
Will they continue to have an exemption?

14. HOW TO IMPROVE HEDGING•
• Market participants are exposed to the bidding Zone risk. A hedging instrument needs to
cover such risk
• If an area fails to have sufficient liquidity the following opportunities may be evaluated:
• Auction single EPADs will support the Nordic system price
• Auction pair of EPADS (EPAD COMBO) can give market participants a synthetic fully firm
FTR obligation
• Introduction of market makers in EPADs in bidding zones with no sufficient liquidity
• Reduce number of price areas
Few and homogeneous products leads to less market fragmentation and more competition.

15. BENEFITS WITH EPAD AUCTIONS
BENEFITS WITH EPAD AUCTIONS
Sufficient for price area hedging purposes
Provides full firmness for bidders
Supports the day-ahead-auction and creditability of the System Price
Social welfare gains through increased competition
Increase the liquidity in the secondary EPAD market
TSO receives the congestion from the area
NO impact on transmission capacity allocation (ATC)
NO administrative hassle (no nomination) to handle the physical cross border
flows.
Transparency (auction results are made public)
Market participants with hedging needs can already access the EPAD market

16. FINAL REMARKS
16

17. APPENDIX

18. MARKET SHARE PER CUSTOMER CATEGORY
0.00
30.00
60.00
90.00
120.00
150.00
180.00
210.00
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Jan-11
Mar-11
May-11
Jul-11
Sep-11
Nov-11
Jan-12
Mar-12
May-12
Jul-12
Sep-12
Nov-12
Jan-13
Mar-13
May-13
Jul-13
Sep-13
Nov-13
Jan-14
Mar-14
May-14
Jul-14
Sep-14
Nov-14
Jan-15
Mar-15
TWh
On Orderbook traded Market Share per Customer Category
Monthly 2011-2014
Turnover Credit Institution Finance/Fund Fundamental

19. OPEN INTEREST TWH
0
100
200
300
400
500
Open Interest Nordic Power Monthly (TWh)
Series1
OPEN INTEREST MW
ENOYR-16 8264
ENOYR-17 5635
ENOYR-18 2540
ENOYR-19 1026

20. MARKET SHARE PER COUNTRY
Non-Nordic members market share in 2007 = 17 % / 2014= 33 %