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Launch of European renewable energy market auctions

Amsterdam, 8 May 2012

STX Services BV, Europe’s leading voice and electronic broker in environmental based commodities, announced today that it has launched an electronic auction platform for the sale and purchase of Renewable Energy Certificates (Guarantees of Origin (GoO)) relating to EU power consumption.

This unique auction, in which multiple buyers and sellers may participate concurrently, achieves a perfect simulation of an open market place. The design of the auction has been inspired by other well established markets, including metals and fixed income, in which auctions play an important role.

The easy to use secure online auction system allows users to login and to participate from wherever they find themselves.

The result of the auction will be the discovery of the true fair market price based on pure supply and demand dynamics. The Auction will be run on a regular basis and the results will be collated to form an historic market index that STX will publish.

The first auction event, held earlier today, was very well attended more than 25% of the most active market participants and successfully facilitated the sale and purchase of 100GWh of GoOs at a clearing price of €0.37 Euro.

“The STX Auction provides a gateway to liquidity in an otherwise fragmented international market. By creating a liquidity pool with an integral clearing mechanism participants are provided with a fast, efficient, transparent and low risk means of transacting with one another.” said James Emanuel, commodity auction expert and Head of Electronic Markets at STX.

“The STX Auction provides us with immediate access to a large number of counterparties without the time consuming and onerous process of signing each of them up individually as was the case in the past” added Pim de Feijter, Renewable Structuring at Eneco Energy Trade. “The other big attraction of this innovative service is that the risk profile of each deal is significantly reduced and settlement occurs within days of the auction close.”

”For the standard certificates we welcome simplified trading through STX’s electronic platform. To meet specific needs from customers and to remain on top of their wishes, we also continue to develop direct contacts with our buyers. The higher prices that are paid for these special products justify the additional workload involved in this.” said Willemien van den Hoogen-Bakker, Head of Renewables Trading at Statkraft.

“The STX Auction allows us to match with as many counterparties as is necessary in order to transact larger volumes at a pure published market price determined by market forces of supply and demand. Greater transparency can only be a good thing for the market” added Dania Facolli, Trader at NValue.

The Green Power market is coming of age and today was the first time that participants have been able to trade on a simple cleared transparent electronic trading venue. This is a landmark event in the evolution of this market which has expanded exponentially in recent years.

The European 2009 “RES” Directive has created a structure around which the Green Energy market will more easily become harmonised across the EU and in neighbouring jurisdictions including Scandinavia and Iceland. Participation is already geographically spread from Iceland to Finland to Croatia. An electronic forum will help focus the fragmented liquidity that currently exists.

Market regulation is evolving in such a way that in future commodity markets may all be required to operate in transparent trading venues. With this in mind STX has designed this service to allow GoO market participants, big and small, to participate on a level playing field in an Organised Trading Facility.

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