(c) 2009 F. Bruce Abel
You have to twist your mind from the UK to here, but the principal dramatically demonstrated in "No Hot Air" is the same. Aggregation for natural gas in today's market cannot beat the default price. 
A fixed price is basically the projected monthly volume multiplied by the monthly price. November is roughly 10% of an annual heating load. If one fixed a price in September 2008 for one year, November was £1 a therm. The lowest possible price one could pay for November in advance was on 32.05 in early September. But the wholesale index price for System Average Price has been below 25 this month.
In English: Consultants cannot beat the default price, the price of doing nothing. So what are people paying them for?
Monday, November 9, 2009
Aggregation -- Natural Gas From No Hot Air, a British Blog
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About Me
- f bruce abel
- Cincinnati, Ohio, United States
- Graduated Yale University ("undefeated class "); Harvard Law School, 1964; top 1/3 of class; classmate/sectionmate of Supreme Court Justice Steven G. Breyer. Started law practice with Frost & Jacobs, then a 17-man law firm. Commercial litigation. Migrated to utility law after the Arab Oil Embargo. In that Energy and Utility Practice: Litigation and negotiating for Industrial and Commercial Clients Regarding Electricity Pricing and Deregulation; was Toyota Georgetown ground-up utility attorney. "av" rating for superior legal ability and very high ethical standards with the nationally-known legal guide, the Martindale-Hubbell Law Directory. Returned to a general litigation practice at that time and continue with that now.