MUFG Bank acquires 49% in enechain’s eClear to provide power futures services

Mitsubishi UFJ Financial Group announced that its consolidated subsidiary, MUFG Bank, has obtained approval for participant qualifications in the energy market from both the Tokyo Commodity Exchange (“TOCOM”) and the Japan Securities Clearing Corporation, in preparation for commencing power futures trade execution and clearing services. Additionally, the Bank has decided to invest in a 49% stake in eClear, a subsidiary of enechain, and has concluded an agreement with eClear to this effect. As a result, eClear will become an equity-method affiliate of the Bank.

TOCOM is a domestic exchange handling energy commodity futures. The Bank is preparing to enter the power futures trade execution and clearing services business at TOCOM in October. By leveraging MUFG’s creditworthiness, the Bank aims to contribute to the enhancement of price hedging functions in the overall power trading market by increasing trading volume in the power futures market.

eClear, a subsidiary of enechain, which operates Japan’s largest power hedge wholesale trading marketplace, provides services for reducing counterparty risk in wholesale power spot trading. Through this investment, MUFG aims to leverage its creditworthiness to expand eClear’s transactions and functions, thereby providing more comprehensive services to customers in power spot trading and other transactions.

“Ensuring stable and resilient energy supply” is a key issue in the Japanese government’s “6th Strategic Energy Plan”. With the anticipated increase in power consumption from expanded use of generative AI and concerns over the impact of power quantity and price fluctuations on industry and public life due to tensions in the Middle East and reduced investment in fossil fuel development. MUFG is committed to “Drive Social & Environmental Progress (Sustainable Society)” as one of the three pillars of its Medium-term Business Plan. By entering the power futures and spot markets, improving customer access to exchanges, and building hedging infrastructure for related businesses, MUFG aims to enhance price predictability and hedging functions in Japan’s power trading, diversify services provided by retail electricity businesses, and contribute to the overall development of the power market and stabilization of power supply from generation to wholesale and retail.

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