The trading floor's various areas work together like a well-oiled machine. Each morning about 6 a.m., traders arrive and begin the day by surveying the generation systems, energy markets and the weather. With that information in hand, they determine whether it will be more cost-effective for Alabama Power to generate its own electricity for the next few days or buy it from another provider. Several factors play into this determination, Dennis says. Market prices change, storms pick up speed, generators fail.
Traders do their best to plan ahead.
Another key piece of the trading floor puzzle is the generation operations control, which regulates Southern Co.'s numerous generators, ranging from 80 megawatts to 1,000 megawatts and crossing a variety of fuel platforms. Southern Co. makes use of nuclear, coal, natural gas and hydroelectric sources. Despite the best planning, Southern Co.'s production occasionally falls short of demand due to generator outages or weather. When Mother Nature shows her spontaneous side and spikes energy needs beyond capacity, spot buyers swing into action. It's their job to find the most economical price for reliable energy that can be delivered immediately.