FUNDAMENTALS

Want to learn Python correctly?

Start with the Re-introduction to Python for Software Engineering textbook.

Gas and Power Derivatives Explained: Futures, Swaps, Options

An energy derivative is a contract whose value comes from the price of gas, power or another energy commodity. This article follows one supplier hedging one January with a forward, a future, a swap and an option, and shows what each costs in a mild month and a cold one.

LNG Pricing Explained: Contracts, Benchmarks and Costs

LNG has no single world price. This article prices four cargoes on the same day, by an oil-linked formula, a Henry Hub formula, a European hub and the Asian spot market, then shows what transport adds and how to convert a price per MMBtu into a price per tonne.

Power Trading Explained: Day-Ahead, Intraday & Balancing

Power trading is the buying and selling of electricity for delivery at a set time. This article follows one supplier and one half-hour through the day-ahead auction, intraday trading, gate closure, the Balancing Mechanism and imbalance settlement, with the sums worked through.

Revised REMIT Reporting: ACER's October 2026 Guidance

On 29 October 2026 ACER published the first guidance for the revised REMIT reporting rules, including TRUM version 8 and new XML formats. This guide explains the three phases from October 2027 to July 2028, who reports what, and the new Algorithm ID field for orders and trades on organised market places.

REMIT Article 5a: What Algorithmic Traders Must Record

Since May 2024, REMIT has a rule for algorithmic trading in wholesale energy. This guide explains which software it covers, the records it asks you to keep for five years, what the regulator can ask to see, and the Algorithm ID that every reported transaction will carry from 29 October 2027.

Clean Dark Spread Formula: Worked Example and Python

Master dark spread calculations for coal-fired power plants: efficiency factors, carbon emissions at 0.96 tCO2/MWh, fuel switching economics, and why European coal is disappearing. Includes Python implementation, worked examples with 2026 prices, and comparison to spark spreads.

LNG Shipping Economics: Why US Gas Doesn't Set UK Prices

How the global gas market sets UK prices: Henry Hub as a floor, LNG shipping costs and netback, Europe against Asia for cargoes, the UK's small storage, NBP-TTF basis risk and the storage break-even, with a Python calculator.

Mark-to-Market P&L Formula: How Traders Calculate PnL

Mark-to-market P&L from first principles: the formula, why the sign matters, realized vs unrealized P&L, a hedged six-trade portfolio, a Python calculator, live vs settlement prices and common mistakes.

Physical Foundations of Energy Commodities

Master the physical foundations of energy trading: instant grid balance, merit order dispatch, and how infrastructure constraints create trading opportunities. The essential foundation for understanding spark spreads, gas shipping, and storage arbitrage.

Position Aggregation & Delta Exposure | Energy Trading

Master position aggregation from first principles: signed quantities, the three-key rule, physical vs financial splits, delta exposure, and hedge ratios. Includes Python implementation of a position engine - the foundation every trading system uses.

Spark Spread and Clean Spark Spread: Formula and Example

Master spark spread calculations: efficiency factors, carbon emissions, hourly variation, and why plants run at losses. Includes Python implementation and real-world trading strategies for CCGT dispatch decisions.

Physical Energy Trading vs Financial: UK Power and Gas Guide

Comprehensive guide to physical vs financial energy trading in UK and European markets. Covers spatial arbitrage (NBP-TTF pipeline trading), temporal arbitrage (storage economics and forward curves), quality arbitrage (spark spreads), and the software architecture challenges of building integrated ETRM systems. Essential for engineers, quants, and aspiring energy traders.

Why Market Knowledge Beats ETRM Skills in Energy Trading

Learning an ETRM system is like learning Excel to be a CFO. Discover why the real value lies in understanding the business and the market, not the specific trading tool.

Energy Trading 101: How It Works, Who Trades and Why

Learn energy trading fundamentals from a software engineer's perspective. This comprehensive guide explains spot vs forward markets, hedging mechanics, physical vs financial settlement, exchange vs OTC trading, and how Python-powered analytics pipelines create competitive advantage in UK energy markets.