Intermediate

2.1 POWER TRADING ARRANGEMENTS
Power trading contracts exist in different types of formats such as
a) Bilateral trading   b) Power trading through intermediaries   c) Power exchanges

b) Power trading through intermediaries:
as markets get deeper, more intermediaries emerge in the form of licensed traders. Power traders reduce search costs by providing information about buyers and sellers and match buyers and sellers and act as a facilitator in concluding trading arrangements. Some power traders also provide contractual platforms including financial arrangements. Both types of arrangements bilateral and through power traders typify mutual bargaining process where the price is not disclosed. Bilateral contracts are flexible and are based on bargaining and negotiation; however, the price discovery process is not transparent.





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