IDEAS home Printed from https://ideas.repec.org/p/vuw/vuwcrt/375906.html
   My bibliography  Save this paper

Managing the Risk of Power Short falls: A Case of Chasing One's Tail

Author

Listed:
  • Thomas Noe

Abstract

Electricity retailers sometimes find themselves in the situation where consumer demand exceeds their ability to supply. One possible response to this shortfall is to buy power on the spot market, but this is risky because of the volatile nature of spot prices. An alternative option is to hedge using financial derivatives. Thomas Noe outlines the complex hedging problem faced by power companies, describes the optimal strategy, and considers the feedback effect of this strategy on the underlying dynamics of the electricity spot market.

Suggested Citation

  • Thomas Noe, 2007. "Managing the Risk of Power Short falls: A Case of Chasing One's Tail," Competition & Regulation Times 375906, New Zealand Institute for the Study of Competition and Regulation.
    • Handle: RePEc:vuw:vuwcrt:375906
    as

    Download full text from publisher

    File URL: https://ojs.victoria.ac.nz/crt/article/view/3759
    Download Restriction: no
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:vuw:vuwcrt:375906. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Library Technology Services (email available below). General contact details of provider: https://edirc.repec.org/data/fcvuwnz.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.