The Singapore Exchange (SGX) is planning to launch the first electricity futures in Asia.

It is initiating a public consultation on the proposed introduction of SGX Uniform Singapore Energy Price (Usep) quarterly base load electricity futures, to be traded on its derivatives trading platform and cleared on its clearing house.

The contract will be a standard, cash-settled futures contract listed on a quarterly basis: January to March, April to June, July to September, and October to December.

The contracts provide a means for market participants in the Singapore electricity market to manage their risk exposures.

Potential new participants to the electricity market can also use the futures market to back fixed price contracts for their consumers, SGX noted in a statement on March 31.

It plans to launch the contracts in the fourth quarter.

The consultation paper is available on SGX's website at www.sgx.com.

It is open to comments and suggestions until April 21.