Increasing electric grid resilience with integrated planning

Increasing electric grid resilience with integrated planning Volatility is normal in commodities markets. But energy and commodities companies, including utilities, industrial firms, and trading houses, are now dealing with higher frequency of extreme events. They face four big fundamental changes in the markets.

First, energy markets in particular are becoming more globally interconnected. For example, LNG prices are increasingly connecting major global gas markets to each other¹. Similarly, European power and gas trading hubs are increasingly correlated from north to south and west to east, progressively transforming what used to be to a collection of local trading hubs into a more regional market.

Second, markets are trading in real time more than ever; for example, power and gas can now trade in slots of only 10 minutes in a number countries compared with daily a few years ago. As a result, companies are rolling out new intraday trading teams and algorithmic models to cope with this new market structure.

Third, markets are more and more automated; day-ahead and intraday power and gas trades are increasingly the result of automated algorithms rather than human intervention, employing similar techniques used in equity and fixed-income markets.