ASIC is suing Delta Power & Energy (Vales Point) Pty Ltd (formerly named Sunset Power International Pty Ltd) (Delta) for allegedly manipulating the ASX 24 market for electricity futures contracts.
In civil penalty proceedings filed in the Federal Court of Australia, ASIC alleges that on 30 occasions between 8 September 2022 and 6 October 2022, Delta placed orders for New South Wales Peak Load Electricity Futures Contracts shortly before the market close of the ASX 24 for the improper purpose of affecting the daily settlement price for those quarterly futures contracts.
ASIC alleges that these orders had (or were likely to have) the effect of:
- creating a false or misleading appearance that Delta's purpose was to purchase the quarterly futures contracts at the lowest realisable price,
- creating a false or misleading appearance that the daily settlement price for the quarterly futures contracts (and the daily settlement price for the corresponding calendar year 'strip' products) reflected the forces of genuine supply and demand in an open, informed and efficient market, and
- influencing the level at which the daily settlement price of the quarterly futures contracts, which ASIC alleges is a financial benchmark, was generated or administered.
ASIC Chair Joe Longo said, 'Manipulation of the daily settlement price of the ASX 24 electricity futures contracts has the potential to create a commercial benefit at the expense of others in the market and adversely impact market integrity.
'The consequences of manipulating energy markets, especially in times of market stress and volatility, can flow through to the real economy, for example, as higher supplier funding costs, and in turn, energy prices.
'Manipulation in energy and commodities derivatives markets has been a particular focus for ASIC in recent years and we will continue to act against conduct that undermines market confidence', Mr Longo said.
ASIC is seeking declarations and pecuniary penalties against Delta.
The matter will be listed for a case management hearing on a date to be fixed by the Court.
