ASX announces temporary change to Block Trade thresholds for Australian and New Zealand Electricity Futures and Options
Wed 8 Nov 2023
As per ASX Notice 1156.23.11, ASX recently identified a technical issue that could impact the execution of User Defined Combination (UDC) orders on the ASX 24 market, as detailed in notice 1143.23.11. As a precaution, the creation of UDC instruments has been temporarily disabled. In response to this, clients within the electricity market have expressed concern around the inability to execute combination trades where Exchange Defined Combinations (EDC) do not exist.
As an interim solution, ASX is lowering the minimum volume threshold to 1 lot on Block Trades (subject to a number of conditions) across Australian and New Zealand Electricity spreads that cannot be executed via an Exchange Defined Combination. This will allow Market Participants to continue to execute strategy orders without the associated legging risk. To support this, a temporary change to Procedure 4820 will take effect immediately and remain in place until further notice. A marked up version of the Procedure is attached.
Australian Electricity Contracts
The change to minimum Block Trade thresholds will apply to the following contracts provided the below conditions are satisfied. Note that normal Block Trade cut off times will continue to apply.
| Contract type | AU Electricity (Futures and Options) |
| Quarterly Base Load | BN, BQ, BV, BS |
| Monthly Base Load | EN, EQ, EV, ES |
| Strips on Quarterly Base Load, Peak Load and Base $300 Caps | HN, HQ, HV, HS, DN, DQ, DV, DS, RN, RQ, RV, RS |
| Quarterly Base Load $300 Caps | GN, GQ, GV, GS |
| Quarterly Peak Load | PN, PQ, PV, PS |
Conditions applied Australian Electricity Blocks
- The Block Trade must be a spread comprised of one or a combination of the above contract codes
- The Block Trade must have two or more legs (inter spread or intra spread)
- The temporary exemption does not apply to Block Trades for existing EDC spreads. Minimum threshold requirements continue to apply for existing EDC spreads
- The Block Trade must be allocated to a single client on the buy and sell legs of the spread
- Participants must continue to comply with Market Integrity Rule requirements
New Zealand Electricity Contracts
The change to minimum Block Trade thresholds will apply to the following contracts provided the below conditions are satisfied. Note that normal Block Trade cut off times will continue to apply.
| Contract type | NZ Electricity (Futures and Options) |
| Quarterly Base Load | EA, EE |
| Monthly Base Load | ED, EH |
| Strips on Quarterly Base Load | EB, EF |
| Quarterly Base Load $300 Caps | GN, GQ, GV, GS |
| Quarterly Peak Load | EC, EG |
Conditions applied to New Zealand Electricity blocks
- The Block Trade must be a spread comprised of one or a combination of the above contract codes
- The Block Trade must be a spread trade (inter spread or intra spread)
- The Block Trade must be allocated to a single client on the buy and sell legs of the spread
- Participants must continue to comply with Market Integrity Rule requirements
What do I need to do by when?
Participants are encouraged to review the changes outlined in Procedure 4820 in addition to the conditions outlined in this notice. Participants should continue to be mindful of and compliant with ASIC Market Integrity Rule requirements.
Need more information?
Issued by
Ben Jackson, General Manager, Market Operations
Contact information
Trading Operations
(02) 9256 0677, 1300 655 560
tradingoperations@asx.com.au or commodities@asx.com.au