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Clearing the obstacles

Credit quality is essential to every energy firm’s success, as recent problems at Aquila and Dynegy attest. Couple this with the post-Enron threat of increased regulation for OTC energy derivatives and it is clear that the energy trading market needs redirection. Could clearing house initiatives such as EnergyClear, launched this month, be a solution?

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When does an energy trader favour tighter over-the-counter energy trading regulation? When the future of its trading business looks bleak. In July, Richard Green, Aquila’s chairman, said he fully supports US senator Dianne Feinstein’s proposal for more aggressive Commodity Futures Trading Commission (CFTC) oversight of energy derivatives trading (see box). Aquila is currently looking for a

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