How is power trading done?

Could you please elaborate on the process of power trading? I'm curious to understand the mechanics behind it. Specifically, how do traders identify opportunities for buying and selling power, and what factors do they consider when making these decisions? Additionally, how do they execute these trades, and what role do exchanges and other marketplaces play in facilitating these transactions? Lastly, what are some of the risks and challenges associated with power trading, and how do traders mitigate them?