For clarification of the project for the EFET (European Federation of Energy Traders) it is important to distinguish the following 3 terms:

EFET is a federation consisting of the major European Energy Traders which defines standards for energy trading

EFETnet is a B2B integration project based on EFET standards

EFET Box is a software product based on the Ponton X technology implementing the EFET standards

The EFETnet Project
Since 2005 more than 40 European Energy Traders have decided to implement the EFET Box. They are using the EFET Box which is based on Ponton X technology for efficient matching of trade confirmations over the internet.

For the most part trading of electricity and gas is done "over the counter" (OTC). Trading partners negotiate deals over the telephone or indirectly using a broker. To confirm the transaction both parties exchange trade confirmations containing all trade details via fax. Some of the larger European Traders manually exchange hundreds of trade confirmations per day resulting in huge operating expenses and increasing the risk of mis-communication in the entire industry drastically. For that reason the EFET (European Federation of Energy Traders) has developed the eCM (electronic Confirmation Matching) standard.
This standard defines how trade confirmations have to be exchanged and matched. The major European Traders have implented the standard to ensure consistent and efficient exchange of trade confirmations.

In the first quarter of 2008 companies such as Barclays Capital, BG Group, BNP Paribas, Calyon, Cargill, Centrica, Citi Group, Conoco Phillips, Delta, Deutsche Bank, EDF Trading, Electrabel, EnBW, Endesa, Eneco, Enel, Enercity, E.ON UK, Essent, ExxonMobil, Gaselys, Gaz de France, Gazprom, GFI, Goldman Sachs, ICAP, JPMorgan Chase, Man Financial, Merrill Lynch, Morgan Stanley, Norsk Hydro, RWE, Sempra, Shell, Spectron, Statoil, Total, TFS, Tullett Prebon, UBS and Vattenfall have implemented the EFET Box or are in the final integration phase. A number of others are in the evaluation phase so that by the end of 2008 a total of over 40 EFET Box users can be expected.

Why is EFETnet so successful?
The challenge was to build a powerful B2B network from the ground up. As usual at first the classical "chicken and egg" problem has to be solved: how can the "early movers" rely on the fact that others will join and how can the "late majority" be convinced of the benefits as quickly as possible? The solution is a joint, industry-wide approach which synchronizes operational, commercial, legal and technical requirements. On this basis EFETnet and Ponton have created the EFET Box.

An important aspect in the success of EFETnet is the diligent implementation of standards across all participants which drastically reduces the overall cost of cooperation. Another positive result is the very low effort to connect new communication partners. An EFETnet participant needs a few hours only to configure and test a connection to a new partner even in complex environments.

EFETnet as an organization
EFETnet is not just a B2B integration project but also a non-profit organization entirely (by 100%) belonging to the European Federation of Energy Traders. As such, all development costs and operational costs are equally split across all participants. The result is: with an increasing number of participants the cost for each individual participant is decreasing. In the early project stage EFETnet was attractive mainly for large Energy Traders with more than 300 trades per day. The broad acceptance leading to more than 20 participants by the end of 2006 however, has brought the break-even point down to about 25 trades per day in the first quarter of 2007.

The future
Currently EFETnet participants process about 50-60% of their trades electronically. This ratio will change to 80-90% in the next few years which will be achieved by supporting additional business processes such as financial products (swaps, coal, oil) and implementation of national CO2 registries of different EU member states. Another extension of the feature set will be Electronic Position Matching.