|Part of the transcript from one of the so-called energy trading whistle blowers|
The big news in the UK at them moment in certain newspapers is that various traders have been gaming the system to manipulate the market price.
As an ex gas trader in the very market that is currently attracting attention all I can say is: what took so long to figure that one out?
I mean, wow. I wrote a fictional story a decade ago about this based on my insider knowledge as a natural gas ops analyst and trader (within day and day ahead) working for a giant energy company, which I reheated last year and republished on this blog. The general thrust of my story is that it's not just prices that traders can manipulate but - potentially - the actual physical system as a whole. It really wouldn't be that difficult.
The actual allegations being made, in my opinion, are pretty minor and insignificant. What it might expose, however, could be far more important. The fact of the matter is that if you hand the entire system of energy provision over to private interests whose only raison d'être is to maximise profits, then of course they are going to employ the best brains to beat their regulatory overseers.
My personal take on it is this: so what if the energy market is experiencing price rigging under a privatised system? Would it be any different under a state owned one? Likely not. It's what we can expect of people when they are handed the controls of an essential commodity like energy from which vast sums of money can be gleaned. I'm not excusing the behaviour, just being realistic.
But my contention in the story was and is that it would only take one 'rogue' trader with operational authority to plunge not just the abstract market into chaos but the entire physical electrical grid. I'm just saying.
Disclaimer: I should actually say that I personally was never involved in any wrongdoing, and neither did I know of any traders involved in nefarious activities, although I did turn a few idling power stations down to MSG (minimum stable generation) when nobody was looking in order to reduce pollution and save fossil fuels.