Energy Atlantica has very unique expertise in the economics of physical natural gas in the northeastern US and Canada. Over 14 years, we have compiled significant amounts of data that allow us to understand fair-market pricing in these jurisdictions that often have little liquidity or transparency.
Our Services include:
- Market reporting and commentary
- Forward price curves and hedging strategies
- Historical analysis
- Pipeline utilization
- Risk analysis
Case Study
The Client
A large university exploring a business case for converting buildings from oil heating to natural gas.
The Issue
The conversion to natural gas required a large upfront capital commitment but in doing so, the university would lose its ability to obtain budget certainty on fuel expenses. As oil is a universally liquid commodity, hedging and buying fixed-price contracts was simple and easily understood. However, a switch to natural gas meant that the university would become exposed to the highly volatile and complex pricing formula offered by the local utility.
Services
We educated the university on the complexities of the pricing formula provided by the utility and found products in the marketplace that would allow them to fix their price through a financial hedge for a term of up to 5 years. We assisted in the completion of the hedging contract and credit compliance.