With the volatility in energy commodity prices, we have noticed an increased interest among market participants, particularly energy-generating entities and suppliers, to hedge their electricity price risk. In addition, a number of financial institutions, banks and corporates have entered into or are considering entering into power purchase agreements to purchase renewable energy and meet carbon emission goals. These contracts to purchase renewable electricity in the future are also often classified as derivative contracts.

In our latest publication on “Hedging Electricity in the Irish Market”, we discuss the use of electricity Contract for Difference (CfD) contracts to hedge electricity prices in Ireland, the valuation of these contracts and the nuances in applying hedge accounting for these instruments.

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Analyse the most complex problems facing your business and consult with us to create bespoke solutions. If you have any queries on the Irish electricity market, please contact Jorge Fernandez Revilla or Francisco Jimenez of our Financial Instruments team. We'd be delighted to hear from you.

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