Paper Details

The evolving landscape of energy markets has positioned electricity trading at the nexus of financial and commodity interactions. This paper explores the dynamic relationship between electricity—an inherently non-storable, regulation-sensitive commodity—and the equity markets of firms engaged in generation, transmission, and distribution. Drawing on empirical evidence, theoretical frameworks, and recent developments in electricity futures and spot market dynamics, it examines how fluctuations in electricity prices influence stock performance, the strategic role of hedging, and the impact of volatility on corporate valuation. The analysis underscores how electricity’s unique characteristics—instantaneous consumption, grid dependency, and policy-driven pricing—intensify the synergy between commodity and equity markets. The findings offer critical insights for investors, energy firms, and regulators navigating financial strategies amid renewable integration and market liberalization.

electricity trading, energy equities, non-storability, market synergy, hedging, volatility, renewable transition, electricity futures