Entergy-Koch Trading plans to launch temperature and precipitation indices for the Nordic region before year end. The power trading company, which has teamed up with the Swedish Meteorological and Hydrological Institute and Svensk Krafmäkling for the effort, expects to start trading on the index in December, said Mark Callaway, director of weather origination in London.
EKT has committed to quoting prices in Norwegian krone for temperature and precipitation swaps for maturities out to eight months. However, it will also make markets in other currencies and durations on the back of customer requests, according to Callaway.
The temperature index is made up of six stations in Norway and six in Sweden, while the precipitation index has readings from nine stations in Norway and eight in Sweden.
