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Euronext Nord Pool Power Futures will launch a new dedicated Nordic and Baltic power futures market. This initiative, a collaboration between Euronext and Nord Pool, aims to provide a robust and sustainable infrastructure for power futures trading in the region.
Here’s a breakdown of what this means:
* Cash-Settled Futures: The futures contracts will be cash-settled, meaning there will be no physical delivery of electricity. Instead, the financial difference between the contract price and the underlying spot price at maturity will be exchanged.
* Industry Standard Maturities: The offerings will cover various industry standard maturities, allowing participants to hedge their price risk over different time horizons (e.g., daily, weekly, monthly, quarterly, yearly contracts).
* Underlying Contracts:
* Nordic System Price: This is an unconstrained market clearing reference price for the entire Nordic region. It is calculated by Nord Pool without considering any congestion restrictions in the electricity grid. It essentially represents a theoretical price if there were infinite transmission capacity across the Nordic bidding zones.
* Electricity Price Area Differential (EPAD) Contracts: EPADs are futures contracts that reference the difference between an area price (the price in a specific bidding zone) and the Nordic System Price. These contracts are crucial for hedging “basis risk,” which arises when local power prices (area prices) diverge from the broader Nordic System Price due to transmission constraints or other local factors. EPADs will be offered across the Nordics and Baltics.
* Spot Indices Provided by Nord Pool: The underlying spot indices for both the Nordic System Price and the SDAC Nordic Bidding Zone/Area Prices will be provided by Nord Pool.
* SDAC Nordic Bidding Zone/Area Prices: The Single Day-Ahead Coupling (SDAC) mechanism is a crucial part of the European electricity market. It efficiently allocates cross-border electricity transmission capacity by coupling wholesale electricity markets across different European bidding zones. Each bidding zone has its own “area price,” which is the clearing price for that specific geographical area, determined through a joint auction process that considers supply, demand, and transmission constraints. These are the spot prices for specific geographical areas within the Nordics and Baltics.
* Trading and Clearing: The new market will be traded on Euronext’s Optiq® trading platform and cleared by Euronext Clearing. Euronext is also acquiring Nasdaq’s Nordic power futures business, with open positions expected to transfer to Euronext Clearing in the first half of 2026.
This initiative is designed to enhance liquidity and provide market participants with effective tools for managing their exposure to power price fluctuations in the Nordic and Baltic regions.

Video courtesy of CSOB

Video courtesy of CSOB