Financial optimization solution for renewable energy producers

Financial optimization solution for renewable energy producers
13 April 2015 Michel de Kérever
Schéma CP - Garanties Producteurs

Press release

Hydroption has developed a range of innovative solutions that enable electricity producers to protect themselves against falling market prices by guaranteeing them a fixed selling price.

The end of regulated tariffs forces electricity producers – now subject to market prices – to protect themselves against a possible price decrease. Hydroption offers them guarantees guaranteeing them a minimum income thanks to a fixed price guaranteed for the coming financial year, while keeping the possibility of benefiting from an increase if it occurs.

Toulon, April 13, 2015.

Fixed price guarantees, which have long been used to hedge risks in sectors such as cereals or air transport, are now applicable in the electricity sector. The democratization of these tools now allows power producers to protect themselves against falling electricity prices and to sell their production at a guaranteed minimum price.

Hydroption offers electricity producers without a purchase obligation contract a solution that guarantees a fixed selling price in the event of a market downturn while still being able to benefit from a market increase.

These guarantees are financial management tools that work like an insurance policy. If the producer chooses to operate his guarantee, Hydroption will pay him the difference between the guaranteed fixed price on the day the contract is signed and the market price at the end of the guarantee.

Thanks to a mandate system, the producer is not obliged to commit immediately. It may set a higher target price than the market from which it wishes to set up its guarantee. Hydroption then monitors the market for itself and when this price is reached, the guarantee is put in place.

In summary :

  • Before toping up physical electricity, producers can secure a minimum selling price with Hydroption products.
  • If the market is on a downward trend, the guaranteed price ensures the producer a minimum income (thus avoiding a significant loss of turnover).
  • If the market is on the rise, the producer can top up his electricity at a high price and resell his guarantee to Hydroption (maximizing his earnings).

 Contact :

Lionel Perrin
Communication and web marketing manager
06 85 85 34 96
lperrin@hydroption.com

More information available on our page MARKET PRICE GUARANTEES.

Find and download the press release below in PDF format: CP HYDROPTION – Garanties Producteurs