Pricing Block and Index Products in the Electricity Industry
Open Access
Author:
Witman, Colin Mitchell
Area of Honors:
Energy, Business, and Finance
Degree:
Bachelor of Science
Document Type:
Thesis
Thesis Supervisors:
George Spencer Young, Thesis Supervisor Seth Adam Blumsack, Thesis Honors Advisor
Keywords:
Block and Index PJM Finance Electricity Risk Pricing Forecasting
Abstract:
Block and Index style products are becoming a staple in the electric procurement business. This research serves to explore how the contract is priced using a “real – life” example based on government accounts from the PPL zone in the PJM Interconnection. Utilizing existing time-series forecasting techniques, the paper aims to quantify the price of the Block and Index contract, while providing the necessary background for those not familiar with the electric industry.
