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The electricity trading market size is forecast to increase by USD 111.34 billion and is estimated to grow at a CAGR of 6.56% between 2023 and 2027. The report includes historic market data from 2017 - 2021. The growth of the market depends on several factors such as a rise in vendor collaborations, the increase in cross-border power trading, and the growth in the adoption of energy storage systems.
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The rise in the entry of new players is a key trend in the electricity trading market. A power exchange offers a platform for traders, buyers, and sellers to enter into spot contracts that are for the same day (intraday), the next day, and on a weekly basis. It's similar to commodity exchanges and has a payment protection mechanism in place for sellers and buyers.
Globally, many large vendors are entering the electricity sector. An increase in new entrants into the electricity industry for business expansion and the resultant competitive pricing of electricity will propel the growth of the global electricity trading market during the forecast period.
The day-ahead trading segment is estimated to witness significant growth during the forecast period. Day-ahead trading refers to the trading of electricity for the following day, which takes place in exchanges such as the European Power Exchange in Paris, Energy Exchange Austria (EXAA) in Vienna, or in OTC Trading via contracts negotiated bilaterally. The auction market is a less frequent term of reference for the day-ahead trade.
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Day-ahead trading is voluntary, financially binding forward electricity trading, wherein sellers and buyers trade for a required volume of electricity for the next day. The characteristics of both physical and financial markets are used as a basis for day-ahead trading.
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APAC is estimated to contribute 39% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
Another region offering significant growth opportunities to vendors is Europe, Europe is among the top three largest markets for electricity trading across the globe. The increase in trade volume, owing to a rise in electricity demand and a surge in the adoption of renewable energy, will boost the electricity sector in Europe. Several associations for power trading are present in Europe that ensure the competitive pricing of electricity. The EU has been at the forefront of the deployment of global renewable energy. The supportive policy measures for clean energy sources and the adoption of long-term renewable targets will result in strong growth of the regional market during the forecast period.
The COVID-19 pandemic in 2020 disrupted the European electricity trading market, resulting in lower industrial demand and price variations owing to the imposition of lockdowns. However, with the introduction of COVID-19 vaccination drives in 2021, the economies, fueled by the increased demand for electricity trading and the stabilizing of the region's market, were finally recovering from the adverse effects of the outbreak. The European Commission's investigation identified probable gas transit disruptions from Russia to Europe, which might have an impact on electricity generation. This, in turn, will negatively impact the growth of the regional market if the war does not end during the forecast period.
The rise in companies' collaborations is driving growth in the electricity trading market. Increasing trade volumes for power exchanges, together with an increasing number of collaborations between suppliers in the electricity sector, will drive the global electricity trading market during the forecast period. Several power exchange companies across the world are collaborating to explore opportunities in the electricity market.
However, increasing trade volumes, owing to high electricity demand, will stimulate the electricity sector. Europex is a non-profit association comprising European energy exchanges. The exchange and commodity market in electricity will therefore benefit from increasing trade volumes, along with favorable initiatives, which will propel the growth of the electricity trading market during the forecast period.
The self-generation of electricity and growth in the adoption of microgrids is a major challenge in an electricity trading market. The alternatives to electricity trading include microgrids and the generation of power themselves, which have also been increasingly adopted. Several businesses and homes are installing methods to generate their electricity through solar panels and small wind turbines, thus reducing their dependence on electricity companies.
As they provide electricity to remote and rural areas, microgrids have gained importance. The self-generation of electricity is also gaining popularity among customers owing to clean energy and supportive government policies. This will negatively affect the growth of the global electricity trading market during the forecast period.
The market research report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Electricity Trading Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Deutsche Borse AG- The company offers Electricity trading services under the subsidiary European Energy Exchange AG.
The research report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The electricity trading market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Electricity Trading Market Scope |
|
Report Coverage |
Details |
Page number |
165 |
Base year |
2022 |
Historic period |
2017 - 2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 6.56% |
Market growth 2023-2027 |
USD 111.34 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
5.92 |
Regional analysis |
Europe, APAC, North America, South America, and Middle East and Africa |
Performing market contribution |
APAC at 39% |
Key countries |
US, China, Japan, Germany, and UK |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
BP Plc, Deutsche Borse AG, Equinor ASA, Euronext N.V., Fortum Oyj, Intercontinental Exchange Inc., Japan Electric Power Exchange, NTPC Ltd., Power Exchange India Ltd., Tata Power Co. Ltd., Vattenfall AB, Axpo Holding AG, Energy Trading Co. Sro, Indian Energy Exchange Ltd., JSW STEEL Ltd., Manikaran Power Ltd., Next Kraftwerke GmbH, PTC India Ltd., Statkraft AS, and VECO Power Trading LLC |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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