02.05.2016: SOPTIM develops all-in-one solution for intraday trading

Monday, 21. November 2016 21.11.2016

Intraday power trading is becoming increasingly important as more and more volume is traded in the short term. This is due to the ever-increasing share of production of renewable energies, which are easier to precisely forecast just before delivery than in the Day-Ahead Process. Every fifteen minutes, intraday traders have to process new forecasts, optimize the portfolio on both the purchasing and sales sides on a revolving basis, and keep diverse communication processes under control. Conventional commercial software, in which large amounts of data are often moved, is too slow. That’s why SOPTIM AG has developed SOPTIM iTrade: a solution that is specifically designed for intraday trading. As a special feature, the software is modular and supports all relevant trade tasks in its fully configured integration. The software should be ready for deployment by the end of 2016.

In Germany, photovoltaic and wind power plants combined now represent an installed generating capacity of around 80 GW. It is now standard that power generation load varies greatly. These volatile amounts are not precise enough to accurately control with long-term forecasts, or even with day-ahead forecasts – energy demand control and the costs of balancing energy would spiral out of control. However, the fluctuating production from wind and solar power can be very reliably predicted for the proceeding two to three hours. In addition, operators of controllable thermal power plants can profit from the resulting price fluctuations without risk and thus partially compensate for the pressurized margins of power plants. Intraday trading will therefore become a more and more interesting optimization tool and business model for public utilities, power plant operators, electricity traders, direct marketers and relevant service providers. However, intraday trading also presents a special organizational challenge: many small-scale transactions must be processed quickly, every fifteen minutes – day and night.

These requirements can only be achieved with a system that highly automates and intelligently supports and interlinks all the necessary functions: stock exchange connectivity, forecasting, optimization, trading, position analysis, nomination and communication. Such software must process the mathematics behind the optimal trading decision such that it is transparently decidable for the dealers or even possible to be implemented through full automation. This requires an appropriate system architecture. SOPTIM iTrade will therefore be a separate, modular system that can flexibly integrate existing energy trading software solutions independent of vendors. SOPTIM iTrade will be integrated into the trade process to complement the ongoing ETRM system (Energy Trading & Risk Management). The position management will be merged into the Intraday Solution after the successful Day-Ahead Process.

SOPTIM iTrade comes into play after the Day-Ahead Process. All Day-Ahead positions from the ETRM system will be transferred to SOPTIM’s Intraday Solution and processed therein. After the transaction, they will be transferred back into the ETRM system where subsequent tasks such as accounting, risk reporting and REMIT messages will be performed.

Christian Kirsch, Head of Business Development at SOPTIM, will present the first concrete information about the configuration and functionality of SOPTIM iTrade at the industry conference “Regelenergiemarkt Strom und Intraday-Handel” (Electricity Balancing Market and intra-day trading)  in June 2016 in Berlin. Customers and prospects will be able to view a trial version at the SOPTIM User Meeting on 8 and 9 September 2016.

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