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INTERVIEW: Shape Q platform aims to bring digital trading to green energy sector

Highlights

OTC market platform to use blockchain for transparency

Set to launch operations across Europe then look to US market

First platform to allow trading of green gas, power

London — A new trading platform called shape Q aims to bring digital trading to the green energy sector, emulating a model that has become familiar to the more traditional financial markets, the platform's founders told S&P Global Platts in an interview.

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The platform will use Request for Quote, instead of the current widely used emails or phones used in bilateral trades on green markets. It will allow the purchase and sale of green power and gas by linking them to the relevant Guarantee of Origin (GO), as well as offering green Power Purchase Agreements (PPA). As a result, it will be the first platform to permit the purchase and sale of green gas and power.

The platform is being launched by Massimo Noto, who has over a decade of experience in green energy commodities, and Umberto Urso, who has many years in the financial markets, along with with Ivo Kendra, who has been an IT developer for decades.

One of their key objectives is to be able to offer non-standard contracts, the so-called shapes, where the platform gets its name.

"Gas and power [physical contracts] are mainly on the exchange, but none of them are connected with green certificates," Massimo said.

One of the main challenges in the green energy trading space is how far behind it is from where financial markets are now.

"We want to bring a digital revolution for green energy trading," Massimo said.

The platform will also operate with green PPAs of 1-3 years.

The founders said that one of shape Q's main objectives is to bring more transparency to the market. The platform will publish market data, as well as permit users to discover new counterparties and communicate with them. After publishing the market data on the platform, shape Q will print anonymized trade data on a public blockchain. In this way, the market data will become public and not only accessible to the platform's users.

"We are offering for free everyone the possibility to see [the basic data], so they know what is happening in the platform and have a better idea about prices," Ivo said.

Expansion

The platform is set out in a manner that is open to the heterogeneous specifications of green certificates and new upcoming products, which will continue to flourish as governments seek to meet ambitious renewable and carbon neutral targets.

"The green economy is a big trend, so I think you will see a lot more products appearing in the marketplace," Umberto added.

The company aims to launch across Europe and seek the right partnerships to accelerate their growth.

"Once the business is more consolidated, we would like to move to other markets as that of the US," Massimo added.

The platform is fully independent and will be fully operational from Q1 2021 and will be commission based, the founders said.