The Commodity Futures Trading Commission (CFTC) approved a NewYork Mercantile Exchange (NYMEX) application to trade electricityfutures and options based on delivery at the Pennsylvania-NewJersey-Maryland (PJM) western hub.

The NYMEX board agreed to apply for permission to offer the setof contracts last November to complement the its other two sets ofeastern electricity futures and options – one based on deliveryinto the Cinergy transmission system and the other based ondelivery into the Entergy transmission system – which have beenaveraging a combined volume of close to 1,000 contracts a day.

NYMEX President R. Patrick Thompson said, “We are lookingforward to introducing these contracts in the next few months andexpect to announce a launch date shortly. We feel confident thatthe industry in this region will be well served with the experienceour traders have gained in trading in our western and easternelectricity markets as well as our other energy products.”

The terms and conditions will parallel those in the othereastern electricity contracts, including delivery rate, contractunit, and delivery period. Prices and Fluctuations Prices shall bequoted in dollars and cents per MWh. The minimum price fluctuationwill be $.01 per MWh. The maximum daily price fluctuation will be$6.00 per MWh above or below the preceding day’s settlement price(the basic maximum fluctuation). Expanded limits will apply whenthe contract settles at the maximum limit.

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