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Overview
Sempra Energy Trading ® is a top independent power marketer
in North America and Europe.
SET trades and dispatches power 24 hours a day, 7 days
a week.
SET conducts the business of buying, selling and
wheeling power right from its trading floor. Our
Real Time desk monitors, identifies, and flags potentially
important events in these volatile markets,
while our trading desk manages longer-term structured
transactions.
SET's product offerings to its customers include:
- Price Risk Management
- Asset Management
- Resource Contract Management
- Tolling
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Price Risk Management
There are numerous ways for companies to manage the volatility of their price risks. SET works closely with its customers devising solutions that create, alter, and execute price hedging plans that suit their objectives.
- For load serving entities: SET will help evaluate load vs. resource requirements and help hedge the deficit or excess with fixed or floating contracts.
- For developers: SET will help hedge favorable forward prices or pay money for optionality inherent in the plants.
In managing price risk, SET evaluates all costs and revenue components for a customer and helps secure long-term rates of return.
Asset Management
Assets for customers can be in the form of loads, power plants, rights to transmission, or a long-term contract for fuel. SET can take such assets and help customers create value as the market volatility fluctuates.
- For a city in the Northeast U.S., SET monitors the power market in their area 24 hours a day and monitors their loads and resources, making decisions on their behalf. SET evaluates the economics of the city’s power plants and helps make decisions on how best to supply their load using either third party contracts or their own power plants.
Resource Contract Management
Large users and producers of power often have negotiated long-term power purchase agreements as a resource planning measure in order to meet resource requirements. Often, these contracts come with load-following flexibilities or location flexibilities that can be monetized.
- For a city in the West U.S., SET paid several million dollars up front to utilize delivery flexibilities over the winter month.
- For a Northeast, U.S. utility, SET paid option premium to provide the utility either fuel or power during a one-year term. SET paid additional premium to be able to choose the type of fuel to provide.
Tolling
Generators often look to lock in returns by contracting out power plant capacity in the form of tolling contracts. These can be done physically or financially, can vary widely in term, and often vary depending upon type of unit. SET has contracted with generators across the country on these types of arrangements.
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