Recently in Markets Category

Dr. Doom doesn't give a fig for your commodities exchange traded funds.

In an interview with the Hard Assets Investor website ("Common Sense on Commodities"), Dr. Nouriel Roubini, who called the top on the market in 2005 with predictions of, well, doom by 2008, said speculators pouring cash into commodities funds were to blame for oil prices near $100/barrel and above.

If you build it, will they come?

Tres Amigas appears to think so. If the company builds a power hub in Clovis, New Mexico, in a project announced Tuesday, generation and transmission projects would have to be built to hook into it. The three power interconnections would suddenly be Three Friends instead of living mostly parallel lives. An idea exciting enough that it could make an adventurous type want to do it just because it's never been done. Because it's there.

But a lot needs to fall into place if the 22 square miles Tres Amigas has obtained the lease rights for is to be more than a field of dreams.

Uncertainty is a dirty word in the world of the Regional Greenhouse Gas Initiative, where 2012 carbon allowance prices have sunk over the past year as buyers and sellers wait for Congress to decide how to value them in a federal cap-and-trade scheme.

Detailing the results of the RGGI market's fifth allowance auction this month, RGGI administrators said that 2012 allowance prices were just a cent above the auction clearing price of $1.86/short ton. In comparison, the first auction of 2012 allowances, held in March, saw $3.05/st.

If a hedge fund doesn't hire Brian Hunter, the former Amaranth Advisors trader who helped blow up the fund to the tune of $6.5 billion when his calendar-spread bets went south, some university should probably hire him as a professor.

On the witness stand this week at the Federal Energy Regulatory Commission's hearing on his alleged market manipulation (the trades in question had nothing to do with the fund's later collapse), Hunter has taken the room to Brian's School of Gas Futures Trading.

In the push to redesign the US financial regulatory system, some observers continue to tread a dangerous line, particularly when it comes to ferreting out the role of speculators in determining energy prices.

At the Commodity Futures Trading Commission's Energy and Environmental Advisory Committee earlier this week, Raphael Martinez, a member of the agency's market oversight division, said the industry has "reached a point where we just talk past each other, leaving the public confused."

As the little battle boils in New York state over the shape of the Independent System Operator's power auction, across the country in California the ISO has just launched a day-ahead and real-time market much like New York's, and PJM's, and the Midwest ISO's, and New England's. It took a really long time to get there -- recovering from the 2000-2001 power crisis required slogging through years of process, technology and interest-group negotiation. But it seems that the launch pleased a lot of people.

Like the quarrel between groups at the federal level, the argument in New York about the Independent System Operator's single-clearing-price auction has turned into a game of table tennis.

State Assemblyman Richard Brodsky, who has a bill to get rid of the single-price auction, engaged consultant Robert McCullough to produce a report supporting his view. Consultant Susan Tierney of Analysis Group produced a report opposing his view. Now McCullough has come back with another report.

The ISO's market adviser, David Patton, has told our colleague Eric Wieser that McCullough's work is just "factually inaccurate."

And the winner? The defenders of the status quo are likely to prevail. But it could be that dissidents will be a thorn in their side for a long time.

Cherry trees are not the only thing springing to life this season in metropolitan Washington. The electricity industry is set to witness a technological blossoming of its own with the launch of the Nodal Exchange.

Based in suburban Vienna, Virginia, the Nodal Exchange describes itself as the first independent electronic exchange for forward locational power trading.

The concept of Nodal has been in the works for the past few years, and the exchange is expected to go live in early April. But its seeds may have been planted nearly a decade ago, when electricity restructuring was just beginning to grow.

News flash from the UK: One of the original promoters of that country's power market privatization now thinks it has not delivered what he thought it promised. He wants more government in it now, he wants a government buying agency, and he wants more long-term contracts.

It may be viral marketing, or it may be happenstance. But it is interesting that proponents of the single-price auction that regional power markets operate are having to fight off attacks right now in two states: New York and Texas.

The American Public Power Association has waged a campaign for a couple of years against some of the ways regional markets are structured. The single-price auction, in which all suppliers receive the highest successfully bid price – commonly from natural gas-fired power -- has been the major object of APPA's complaint, which has been joined by the big industrials in the Electricity Consumers Resource Council as well as, at times, a slew of general consumer-interest groups.