Renewable Energy Certificate Contracts on Nodal Exchange

Learn more about trading Renewable Energy Certificate futures and options for the REC programs on Nodal Exchange.

REC CONTRACTS ON NODAL EXCHANGE

Renewable Energy Certificate (REC) markets are created through Renewable Portfolio Standard (RPS) programs, which are generally implemented at the State level. Currently, 31 States plus D.C. have implemented RPS Programs.

Contract Overviews

REC Futures

  • Physically delivered contracts, from defined REC registries
  • Contract size: Varies from 10 to 1,000 RECs
  • Priced in U.S. dollars per REC
  • Minimum tick size: $0.001 to $0.01
  • Last Trading Day: Three Business Days, prior to the last business day of the delivery month
  • Physical Delivery: Last Business Day of the contract month

 

REC Options

  • Options on Futures
  • European style (exercise only at expiry)
  • Equity Style Premium (premium paid up front)
  • Lot size: 1 lot of underlying contract
  • Priced in US dollars
  • Minimum tick size: $0.001
  • Strike Price Intervals: $0.05 for TX, $0.05 for PJM Tri-Qualified, $1.00 for NJ Solar, $5.00 for MA
  • Solar and $0.25 for all others
  • Last Trading Day: 4:00 pm EPT on the 15th calendar day of the delivery month
  • Exercise: Automatic on last trading day, unless exchange is notified to allow in-the-money options to expire without exercise or to exercise expiring out-of-the-money options.

Key benefits of trading on Nodal Exchange

  • Broadest exchange suite of REC futures contracts
  • More efficient physical delivery process
  • Letters of credit available as collateral against Initial Margin requirements
  • Capital efficiency potential through Portfolio (VAR based) margining
  • Products listed and cleared alongside Nodal’s existing power and gas product suite
  • Competitive transaction costs
  • No membership of market data fees
  • Experienced team dedicated to product development and customer support

Key benefits of trading on Nodal Exchange

  • Broadest exchange suite of REC futures contracts
  • More efficient physical delivery process
  • Letters of credit available as collateral against Initial Margin requirements
  • Capital efficiency potential through Portfolio (VAR based) margining
  • Products listed and cleared alongside Nodal’s existing power and gas product suite
  • Competitive transaction costs
  • No membership of market data fees
  • Experienced team dedicated to product development and customer support

About Nodal Exchange

Nodal Exchange, headquartered in Tysons Corner, VA, is a CFTC-regulated derivatives exchange providing price, credit and liquidity risk management to participants in the North American commodity markets. Part of EEX Group, Nodal Exchange is a leader in innovation, having introduced the world’s largest set of electric power locational (nodal) futures contracts and offers over 1,000 power, gas, environmental, natural gas and freight futures, all cleared on Nodal Clear. IncubEx is partnered with Nodal on its North American environmental products.

ADDITIONAL RESOURCES

PDF

REC COntracts on Nodal
Exchange

Webpage

REC Markets
Background

Webpage

Texas Wind and Solar Futures on Nodal Exchange

Webpage

Environmental Products on
Nodal Exchange

This page is for illustrative purposes only. For official contract and trading information, please visit Nodal Exchange