Insights
Risk Management Insights
Price Risk a Key Element in Balancing Natural Gas Supply
October 2011
What doesn't get discussed often in organizations is the price risk associated with the disposal of purchased natural gas that is not needed, or the purchase of additional gas should the organization consume more than projected - and yet, it can have a budget impact. Read more >>
System Gas as a Source of Supply for Larger Consumers
October 2011
The price for system supply from Enbridge and Union has been relatively low and stable for the last while, leading larger natural gas consumers to ask whether system supply is a viable alternative for them. Read more >>
Combined Heat and Power Projects: An Opportunity But Know the Risks
February 2011
The Ontario Power Authority is developing a Combined Heat and Power Standard Offer Program to elicit new projects up to 20 MW in capacity in certain areas of the province. The program will offer projects a standard contract with the OPA, designed to mitigate the risks developers face. The program is an opportunity worth evaluating for organizations with an available thermal load, but the opportunity is not risk-free. Read more >>
Buying Expertise by RFP: Recipe for Problems
February 2011
The procurement policies of many public buyers require that a formal "Request for Proposals" process be used to procure professional services above a certain spend threshold. But the standard RFP can become a Recipe For Problems. Buyers may end up missing out on new ideas and novel solutions that can better meet their needs. Read more >>
Hurricanes and Hedging - Price Risk Management in Action
September 2010
Commodity price risk management costs money and raises questions about how likely it is that things will go wrong and how bad it will be if they do. The annual hurricane season is one phenomenon that can be used to illustrate price risk management in action. Read more >>
How Does Having a Portfolio of Suppliers Save Money?
August 2010
Attempting to reduce energy costs by buying at the "bottom of the market" cannot guarantee consistent savings against market prices. However, having a portfolio of suppliers can guarantee that a buyer will receive competitive pricing and in many cases, demonstrated savings. Read more >>
Unintended Consequences: The Impact of Overhedging
June 2010
Many organizations that use commodities in their operations employ hedging to control the risk of fluctuating commodity prices. But what if you noticed that your commodity costs, net the cost of your hedge, were going up while the market price of your commodity was going down? This is a sign you may be overhedged. Read more >>
Hurricanes and Natural Gas Prices: The Link
May 2010
The production of natural gas may be disrupted by hurricanes that damage or shut down offshore rigs in the Gulf of Mexico. Just expected hurricane activity can exert a noticeable effect on prices long before the hurricanes even form. Read more >>
Buying to Control Price Risk
May 2010
Decisions about locking in energy prices should not be driven by whether the market price is high or low, but whether the price risk is too high. Trying to save money by locking in at the bottom can cost money. Read more >>
5 Simple Steps to Effective Energy Buying
April 2010
Energy markets are hybrids of volatile commodity markets and complex regulated utility services. But there are five simple steps energy buyers can take to reduce costs and manage risk in energy procurement. Read more >>