ICE Energy Market Gets UK Watchdog Approval

LONDON, England -- - Internet-based energy trading platform the IntercontinentalExchange (UK) said it had been authorised by the watchdog Financial Services Authority (FSA) to arrange investment deals.

The IntercontinentalExchange (ICE) expects the decision to boost volumes, especially on its UK power contract, as non-FSA registered companies will be allowed to trade with each other through the platform now it has been registered by the watchdog.

"This authorisation supports Intercontinental's continued expansion into the European markets and increases the services we can offer our participants," Stephanie Trabia, CEO of IntercontinentalExchange (UK) said in a statement.

During its application to the FSA, the Atlanta-based market was allowed to run its UK business under the foreign company exemption rule.

Last year energy dealers said trade on the ICE electricity market was hampered by the FSA rules requiring at least one counterparty in all power deals on the ICE platform to be registered with the FSA.

Volumes in the ICE gas market, which was not governed by the same rules on FSA registration, were higher than those in electricity.

The company and the London Clearing House (LCH) started clearing gas trades in September 2002 and nearly four billion therms have been sold on a cleared basis since then, the firm said.

ICE and the LCH will launch clearing for German and UK power contracts, and for crude oil swaps in March 2003.

ICE was founded in 2000 by a group of energy companies and banks including Goldman Sachs, TotalFinaElf and Royal Dutch/Shell.