PRICING & BASIS RISK CONSIDERATIONS There are price differences between each point in the grid (i.e., bus bar to hub, hub to hub, hub to load zone). Must consider congestion risk when buying power at a generation node (bus bar). Must consider hub-to-hub basis risk when buying power in a zone different than the where the power is consumed. Zone A Zone B Generation Generation Load Load Legend: Generation Node / Bus Bar Generation Hub (aggregation of all generation nodes in a given zone) Load Zone (aggregation of all load or non-generation nodes in a given zone) Load Point / Node Power Flow TIME OF DAY RISK CONSIDERATIONS There are price differences at each hour of the day. When using of off-site renewable supply to hedge load, must consider potential time of day mismatches. Solar sized to meet 80% of Load Wind sized to meet 80% of Load 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Wind Production 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Solar Production Customer Load Shape Customer Load Shape Wind & Solar combined to meet 80% of load 1 2 3 4 5 6 7 8 9 10 Solar Production 11 12 13 Wind Production 14 15 16 17 Customer Load Shape 18 19 20 21 22 23 24
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