Energy markets depend on something that rarely appears on a power plant balance sheet or a commodity specification sheet:
Trust.
Electricity, natural gas, coal, petroleum products and other fuels are physical commodities. But the markets connecting producers to consumers rely heavily on information—prices, volumes, generation capabilities, fuel specifications, transportation capacity, contractual rights and countless other data points.
Utilities need to know that contracted fuel will arrive. Traders need confidence that counterparties control the commodities they claim to be selling. Grid operators depend on accurate information about generation and demand. Market participants rely on price benchmarks that are supposed to reflect legitimate transactions.
When that information is wrong because of an honest mistake, markets usually have mechanisms for correcting it.
When information is intentionally falsified for financial gain, however, the issue can become something much more serious:
fraud.
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