henwood stuff and thoughts about valuation did you guys get this ?
i was too interested in the conversation to interrupt with comments about
risk / return if the decision would be covered in rates , it is the
customers ' curves or equivalently the puc ' s curve .
i think if i were going to approach valuation in commodities where the
assumptions of black / scholes do not apply , i would start with the capm for
large industries in an area , use pro formas to translate this to utility
curves for the input commodities , and add the utility curves .
another issue : the factor that explains why enron is lowest bidder is its
role in the market . in the 1930 s , keynes argued that if most market
participants with long position were hedgers , futures prices would be higher
than spot ; if they were speculators or traders , future prices would be lower
than spot . traders must be compensated for holding the risk ; hedgers
( including utilities and consumers ) are willing to pay a premium for the
certainty . consequently , enron traders have bigger bid / ask spreads and lower
bid prices .
just some random thoughts ,
michael
- - - - - original message - - - - -
date : 01 / 04 / 2001 10 : 41 am ( thursday )
from : " heather mason "
to : hq 3 . em 5 ( michael schilmoeller )
mark your calendar - tuesday january 23 , 2001 downtown houston hyatt hotel
henwood will be hosting a comprehensive ercot symposium on tuesday , january
23 , 2001 . a team of henwood regional power market specialists will be
presenting the latest analysis and
information to assist you in preparing for the new ercot restructured power
market , in addition to an anlysis of the issues now playing out in the wscc
markets . coffee and registration will
begin at 9 : 30 am and the program will run until 3 : 00 pm . lunch and snacks
will be provided .
agenda topics include :
* what will be the critical - success factors for qualified scheduling entities
operating in ercot ' s new wholesale & retail markets ?
* how will market restructuring impact mid to long - term wholesale prices ?
* what is the outlook for new generation ?
* what are the impacts of upcoming emission regulations on ercot ' s generation
resources ?
* what are the new analytical tools available to capture market uncertainty
impacts to your supply contracts and generation assets ?
* what are the restructuring lessons learned from the california experience
and the implications to ercot ?
in conjunction with this program , henwood will have a demonstration room
available to present its latest software applications and e - business
solutions . a nominal $ 75 registration fee is required
to reserve a space in the workshop .
for more information or to reserve your spot , please contact heather mason at
henwood : hmason @ hesinet . com or 916 / 569 - 0985 .
about henwood : henwood offers integrated business solutions , strategic
consulting , and innovative e - business applications to meet the challenges of
the restructured energy markets throughout
north america , australia , and europe , serving clients that include eight of
the ten top utilities in north america , in addition to energy services
providers and power marketers .
henwood stuff and thoughts about valuation
did you guys get this ?
i was too interested in the conversation to interrupt with comments about
risk / return if the decision would be covered in rates , it is the
customers ' curves or equivalently the puc ' s curve .
i think if i were going to approach valuation in commodities where the
assumptions of black / scholes do not apply , i would start with the capm for
large industries in an area , use pro formas to translate this to utility
curves for the input commodities , and add the utility curves .
another issue : the factor that explains why enron is lowest bidder is its
role in the market . in the 1930 s , keynes argued that if most market
participants with long position were hedgers , futures prices would be higher
than spot ; if they were speculators or traders , future prices would be lower
than spot . traders must be compensated for holding the risk ; hedgers
( including utilities and consumers ) are willing to pay a premium for the
certainty . consequently , enron traders have bigger bid / ask spreads and lower
bid prices .
just some random thoughts ,
michael
- - - - - original message - - - - -
date : 01 / 04 / 2001 10 : 41 am ( thursday )
from : " heather mason "
to : hq 3 . em 5 ( michael schilmoeller )
mark your calendar - tuesday january 23 , 2001 downtown houston hyatt hotel
henwood will be hosting a comprehensive ercot symposium on tuesday , january
23 , 2001 . a team of henwood regional power market specialists will be
presenting the latest analysis and
information to assist you in preparing for the new ercot restructured power
market , in addition to an anlysis of the issues now playing out in the wscc
markets . coffee and registration will
begin at 9 : 30 am and the program will run until 3 : 00 pm . lunch and snacks
will be provided .
agenda topics include :
* what will be the critical - success factors for qualified scheduling entities
operating in ercot ' s new wholesale & retail markets ?
* how will market restructuring impact mid to long - term wholesale prices ?
* what is the outlook for new generation ?
* what are the impacts of upcoming emission regulations on ercot ' s generation
resources ?
* what are the new analytical tools available to capture market uncertainty
impacts to your supply contracts and generation assets ?
* what are the restructuring lessons learned from the california experience
and the implications to ercot ?
in conjunction with this program , henwood will have a demonstration room
available to present its latest software applications and e - business
solutions . a nominal $ 75 registration fee is required
to reserve a space in the workshop .
for more information or to reserve your spot , please contact heather mason at
henwood : hmason @ hesinet . com or 916 / 569 - 0985 .
about henwood : henwood offers integrated business solutions , strategic
consulting , and innovative e - business applications to meet the challenges of
the restructured energy markets throughout
north america , australia , and europe , serving clients that include eight of
the ten top utilities in north america , in addition to energy services
providers and power marketers .