Frequently Asked Questions

1. What is needed for my organization to qualify to be a participant on Nodal Exchange?
   To participate on Nodal Exchange, your company must sign the Nodal Exchange Participant Agreement, and have an account with a General Clearing Member who is a member of LCH.Clearnet and Nodal Exchange. All Nodal Exchange Participants must be Eligible Commercial Entities, as defined by the U.S. Commodity Futures Trading Commission (CFTC). It is recommended that you review with your legal counsel to determine if your organization is qualified.
2. How are Nodal Exchange contracts margined?
   Both initial and variation margin apply to Nodal Exchange contracts. LCH.Clearnet calculates initial margin based on a Value at Risk (VaR) methodology. The white paper Clearing and Margining on Nodal Exchange: An Overview contains more detail on margining.
3. Do I have to be a member of LCH.Clearnet to participate on Nodal Exchange?
   No, you do not. You must have an account with a General Clearing Member (GCM) that is a member of both LCH.Clearnet and Nodal Exchange to participate on Nodal Exchange. If you are interested in also becoming a member of LCH.Clearnet, please contact their membership department at .
4. How do I get a copy of the Participant Agreement and Rules?
   These documents are available on our website. Click here
5. How many auctions does Nodal Exchange have per month?
   Currently, Nodal Exchange has one auction per business day.
6. How do Nodal Exchange contracts settle?
   Nodal Exchange contracts are all financially settled. Currently, contracts that settle against the Day Ahead Locational Marginal Price (LMP) as posted by the RTOs are available at all power locations. Additionally, contracts settling against Real Time LMP as posted by the RTOs are available on select locations. Additionally, for select locations, contracts are available that settle against the energy component of either Day Ahead or Real Time LMP. The final settlement price for natural gas contracts for Henry Hub will be a price in US Dollars per MMBtu equal to the monthly last settlement price for natural gas as published by the CME Group's New York Mercantile Exchange (NYMEX) for the month of production. Should the NYMEX monthly last settlement price be unavailable, the final settlement price will be equal to the final settlement price of the Intercontinental Exchange (ICE) Henry Financial LD1 Fixed Price contract as published by ICE for the month.
7. How did Nodal Exchange select which nodes to offer?
   Nodal Exchange selected nodes and defined contracts with the objective of representing all commercially significant nodes in PJM, MISO, NYISO, and ISO-NE. Nodes which have shown very high historical price correlations have been grouped into single contracts. Currently, Nodal Exchange does not offer contracts on any individual load nodes, but does offer contracts on load zones. For CAISO, Nodal Exchange selected commercially significant hubs, zones and pricing points as well as select generation nodes. Not all generation nodes in CAISO are currently represented in Nodal Exchange contracts. For ERCOT, Nodal Exchange currently offers contracts on four hubs and four zones and plans to eventually extend to more locations within ERCOT approximately one year after its nodal launch.
8. What types of transactions can be submitted to Nodal Exchange for clearing?
   Privately negotiated transactions based on Nodal Exchange contracts can be submitted to Nodal Exchange for clearing. These OTC trades can either be submitted by the parties to the trade or by a broker. Note, all auction awarded contracts are cleared as well.
9. Will Nodal Exchange offer options?
   At this time, Nodal Exchange only offers futures contracts.
10. Are there any systems/browser requirements for participating on Nodal Exchange?
    Connectivity to Nodal Exchange is via a web-based browser interface. Nodal Exchange supports multiple releases of Internet Explorer and Firefox.
11. Is automated upload supported?
    Nodal Exchange supports a bulk order upload feature for orders formatted to our XML schema, as well as an automated CSV upload file format upload that can be generated from an Excel spreadsheet. Click here for more information.