By OGJ editors
HOUSTON, Nov. 11 -- Seven over-the-counter (OTC) energy brokers formed the Washington, DC-based Energy Brokers Association (EBA) to help the energy merchant industry navigate the "uncharted waters" that it finds itself in right now.
"This coordinated effort is being made as a proactive response to the current challenging environment in the energy markets. The association recognizes the need for all the key players in the energy markets to define and adopt reliable practices and standards in order to improve and advance the industry, both now and in the future," a news release said.
The EBA will work with energy companies and trade associations, other financial industry participants, and governmental agencies to address financial, regulatory, and operational issues. The EBA also will more clearly define the role of OTC brokers in the marketplace.
Companies engaged in the OTC brokering of energy and energy-related physical and derivative products to institutional clients are encouraged to join. Another six companies have indicated interest in joining EBA since it was announced Nov. 5, a spokesman said.
EBA Pres. and APB Financial LLC Vice-President Chris Edmonds said the members represent brokers of natural gas, electricity, coal, and crude refined products.
"I would say we will stick primarily in the arena where physical and financial derivatives for any energy-related commodity," Edmonds said.
"Not a lot of people outside the traditional energy merchant know that we exist or know what kinds of services might be available from firms like our members," Edmonds said. "It's in the best interest of the industry if we collectively sit down and come out with one voice (saying). . .here's what you can expect from an unbiased third party. . .. We are forming an organization so you can say okay, these member firms are going to be able to help me with my questions as I navigate the uncharted waters that the merchant energy industry is in."
EBA also is intended as a vehicle to work with other organizations having an interest in the energy market whether it's a government agency like the Federal Energy Regulatory Commission or other nonprofit associations like the National Energy Marketers Association.
"It may be more beneficial for us to do that as a collective voice than it would be for us to do that as individual businesses. . .. We are going to come together and put our competition aside for the moment. We are saying what can we do that is in the best interest of the business," Edmonds said.
The founding members are Amerex Group, Houston; APB Financial LLC, Louisville, Ky.; TFS Energy LLC, Stamford, NY; and New York-based GFI Group Inc., Natsource LLC, Prebon Energy Inc., and Starsupply Petroleum LLC.