We define “structured products” as contracts containing any or all of:
a combination of standard and/or non-standard commodity products,
a link between a commodity price and an index or another commodity price,
embedded derivatives (e.g. options), and
delivery schedules outside those of exchange-listed products.
Frequently, structured products have durations that go beyond the liquid horizon of one or several elements within the structure.
The following is a description of a basic set of structured product categories where we excel. However, within the range of commodities that we trade, we are able to service any type of structure that customers view as relevant.
Our objective is to structure products to match our customer’s individual requirements and price them in an accurate, fair and transparent way.
Our ample hydro and pumped storage power capacities in the Alps allow us to offer extensive flexibility in order to enable customers to balance their short-term and long-term electricity surpluses or shortages. We are particularly active in offering our flexibility in the Swiss and neighbouring markets with virtual power plants of any desired complexity. Similarly, we operate gas plants and gas storage facilities, which enable us to trade gas-related flexibilities in much the same way.
This experience and expertise translates into strong capabilities to trade flexibilities also in regions where we have fewer assets and for commodities other than power and natural gas. Wherever we are active in commodity trading, we can always quote a price for anything from swing options in a chosen commodity, to advanced virtual power plants and structured gas storage.
One of the absolute core competencies of Alpiq’s origination teams is providing industrial-sized customers with tailor-made energy solutions, helping them to minimise their operating costs and ensuring a reliable supply of energy.
Alpiq offers a wide variety of supply products, from long-term fixed-price commitments to structured flexible procurement arrangements that provide the customer with a measure of certainty regarding energy costs, while retaining various options that can be decided upon at a later point in time.
Whatever the unique consumption profile may be, we work with the customer to convert it into energy costs that are optimised in accordance with their specific requirements.
We also help find a solution if the customer’s requirements include the need to link a commodity price to a relevant index or another commodity. Our customers never have to restrict themselves to standardised products unless they wish to.
Since providing supply solutions is a key element of our origination business, there is a separate “Supply solutions” section describing a more specific range of more standardised products.
For owners and developers of renewable production assets, a key to success is finding the right partner to help manage the physical output, balancing needs and general market risk.
Alpiq operates its own European portfolio of renewable assets, which provides us with relevant expertise and a hands-on understanding of the needs of this category of origination customers. We can create a customised solution, not just for off-take, balancing and hedging, but also for the management of technical and weather data to support enhanced forecasting and operational excellence. This is further described in the “Origination services” section.
Long-term hedging agreements are particularly important in the Nordic region where subsidies are granted in the form of electricity certificates, which creates a specific market risk in addition to power prices, with additional requirements for off-take and hedging products.
In other markets, other solutions may be more appropriate, for example in Germany and Italy where the subsidy regime actively promotes a more engaged trading approach. For these markets we have specialised RES management services, described in more detail in the “Origination services” section.
With our own natural exposure to gas markets, we have developed very strong capabilities related to managing the inherent risk and monetising flexibility. Alpiq has access to all the relevant trading hubs and a growing involvement also in liquefied natural gas (LNG).
In addition to supply services and wholesale trading of term contracts, we also trade and provide real and virtual gas storage structures to further help customers to capture opportunities.
Many of our clients have significant exposure to more commodities than power or natural gas. We offer the benefit of utilising our strong trading capabilities across a wide commodity spectrum and can offer products incorporating cross-commodity links or links to different indices. These can include links to metals, coal, oil and many other products.
With more than 4 TWh of alpine hydropower generation, based primarily in Switzerland, Alpiq is a reliable partner for renewable energy. We supply green energy as well as a variety of green certificates to industrial customers and resellers across Europe.
Our certified power plants and reliable certification systems allows us to offer solid proof of origin for the renewable energy that we generate, the environmental value of which we market for the benefit of our customers. On request, we offer specific production profiles, or specific production sources/assets. In Norway and Sweden, we have assets that generate electricity certificates as well as guarantees of origin.
In addition to marketing Alpiq’s own generation of certificates, our origination teams work with local customers in order to supply to and purchase from them according to their requirements, arranging anything from standard to structured products, which also cover the relevant green certificates.
In Norway and Sweden, for example, we can provide PPA-like off-take and hedging solutions for the electricity certificates produced by renewable installations such as wind parks and small-scale hydro power stations, helping assets owners to secure revenue and reduce their financing costs.
Below is a selection of the certificates we trade:
Electricity certificates for Norway and Sweden
Guarantees of origin (small and large hydro power and run–of-river plants)
naturemade basic and naturemade star certificates
TÜV SÜD EE Certificates
Hydropower TÜV SÜD EE neu
Green and white certificates in Western Europe (e.g. France & Italy)
Green certificates in Eastern Europe (e.g. Romania)
Colour certificates (Poland)