Head of sales Alan Svoboda stated in interview that CEZ should be one of market makers for electricity on planed Prague commodity exchange in Prague, which should begin operations in the middle of the year. According to PSE’s chairman Petr Koblic there is big interest in commodity exchange in Germany. E.ON already expressed its interest to trade in new electricity market and between other possible players are RWE, Enel. Financial institutions like Morgan Stanley, SG or Erste - Ceska Sporitelna and electricity traders like EGL plans to trade electricity as well and others are expected to follow.
Our view:
Currently CEZ sells its energy on auctions. Wholesale electricity prices increased by 16.87% y/y in 2007. New pricing process will be due to new commodity exchange more transparent. We expect electricity prices further converge to the German level. The energy stock exchange was announce earlier, therefore we see the news as neutral.