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TradeSpark, the online energy exchange that was nearly decimated by the Sept. 11 attack on the World Trade Center, will begin electronic trading again this week, says one of the exchanges chief backers.
TradeSpark, launched in September 2000 by securities firm Cantor Fitzgerald, its technology subsidiary, eSpeed, and five large U.S. energy companies, has become one of the main rivals to EnronOnline, the dominant online energy exchange. But many TradeSpark employees were housed in the offices of Cantor Fitzgerald, which was located on the 101st, 103rd, 1045th and 105th floors of the North Tower. Cantor lost about 730 employees in the disaster, including an undisclosed number who worked at eSpeed and TradeSpark. The TradeSpark trading platform was managed by eSpeed, which provides software and computer integration services.
“We should have the marketplace back up and running with improved functionality very, very soon,” said Bill Lawson, director of strategic development at Williams Energy Marketing and Trading. Lawson, who has been leading the effort to get TradeSpark back online, refused to predict what day the exchange would be up and running, but he is confident that it will happen this week. Lawsons prophecy was confirmed by a TradeSpark spokesperson, who said the exchange could be open as early at Monday or Tuesday.
Although TradeSpark lost many employees, the companys two lead executives, Mike Williams, managing director, and Robert Hayes, chief operating officer, are safe. They were in Houston at the time of the attacks.
Since the disaster, the energy companies that backed TradeSpark — Coral Energy, Dominion, Koch Energy Trading, TXU Energy Trading and Williams Energy Marketing and Trading, a subsidiary of Williams — have been anxious to get TradeSpark operational. At the time of the attacks, the company had about 180 participants trading electricity or natural gas on the site. Although some TradeSpark partners have been working via telephone and fax, those instruments dont offer the price visibility and liquidity of an online exchange.
Energy companies are eager to get the exchange in place so that traders have an alternative to EnronOnline and Atlanta-based Intercontinental Exchange, which, like TradeSpark, was founded last year by a group of energy companies. EnronOnline, backed by energy and trading giant Enron, has garnered the lions share of electricity and gas trading. But energy industry officials contend that having alternative exchanges gives them better prices and a more liquid market. During the second quarter, TradeSpark traded products with a notional value of $41.9 billion, more than double the $18 billion recorded in the first quarter.
Lawson says that besides the loss of many highly skilled people at eSpeed and TradeSpark, the exchange lost a data center located at the World Trade Center. The companys files were fully backed up at its data center in Rochelle Park, N.J. “Thank goodness they had some of those redundant facilities in place,” said Lawson. “There are still large holes and theyll never quite be replaced, but we still have pieces of the business that are still in good shape.”