APX and SKM To Co-Operate On Software Development.

Business Editors

LONDON--(BUSINESS WIRE)--July 6, 2000

The rapidly expanding market for electricity trading in Europe took a significant step forward today with the announcement that APX Europe (Automated Power Exchange) and the Norwegian-based SKM (Skandinavisk Kraftmegling AS) will work together to develop additional functionality for the electronic trading of electricity.

This new alliance brings together the expertise and experience of APX, the only full service internet-based electricity exchange and SKM, the largest electricity broker in Europe. The operation will embrace the activities of SKM's subsidiary, SKM Data, which develops innovative IT and communications solutions for the energy sector.

Initially, APX and SKM will focus on defining and developing on-line services for the market place. This will bring significant benefits to both brokers and other clients by making trading more efficient, by allowing brokers to interface with on-line power exchanges and by streamlining back office settlement procedures.

APX and SKM will also be exploring the creation of integrated on-line clearing services for established markets in northern Europe, which will help reduce the cost of credit in energy trading, improve market liquidity and generate greater market opportunities for both buyers and sellers.

Commenting on the announcement, Per Hjorth, APX Senior Vice President for exchange services, said "APX and SKM share a similar vision, namely to provide buyers and sellers with a full range of trading services at all points in the transaction process."

Ragnar Ottosen, President and Chief Executive of SKM, added "By combining the market knowledge and skills of both companies, we can develop competitive solutions to meet the growing needs of our clients for an efficient trading platform across Europe."

Commenting on APX's objective to launch a full service internet-based power exchange in the UK, Hjorth said "We are currently working through FSA approval procedures and we expect to be up and running when the new UK wholesale electricity trading arrangements (NETA) come into operation before the end of this year. Our product development programme is well-advanced, and in the coming months we will be running intensive training simulations involving a wide range of market participants."

APX is the leading provider of full service internet-based power exchanges. Founded in 1996, APX is a private company with its world headquarters in Santa Clara, California, USA and its European headquarters in London (est September 1999). More than $250m of transactions were processed via APX exchanges in 1999.

The APX team includes approximately 100 electricity industry and software development professionals with years of proven experience and accomplishments working throughout Europe and the USA. For more information, please visit their website - www.apx.com.

SKM is the largest and most dynamic European energy broker, trading more than 200 TWh in 1999. SKM employs over 60 people in Europe and the USA. The company has four operating divisions. SKM Energy Brokers which runs the largest OTC desk for electricity in Europe, SKM Energy Consulting providing advisory and other services to energy companies, SKM Data which develops IT solutions and SKM Kraft AS which is an independent portfolio manager for utilities and industrial users in the Nordic countries. For more information, please visit their website - www.skmenergy.com.