Successful fuel and power contracting depends on the ability to integrate both value and flexibility in the transaction structure.  Extreme volatility in commodity markets warrants innovative risk management techniques.  LAI monitors market events and futures prices for short term tactical decisions, including oil and gas forward purchases, financial options, physical hedges, and energy scheduling in the day ahead and real time markets.  The issue of default risk now requires stakeholders to tailor risk measurement tools to address the shrinking number of creditworthy counter-parties.

LAI can tailor alternate risk management techniques that can be prioritized in order to delineate achievable tradeoffs among cost, security of supply, and risk management objectives.  LAI examines the tradeoffs available with separable risk management plans that employ traditional procurement options (bilateral contract, fuel displacement, and tolling arrangement) and mitigation strategies using triggers, collars, swaps, and futures contracts for cross-commodity arbitrage.  We are experts with the Black-Scholes model for options valuation.

LAI helps our clients:

	Assess enterprise risk and establish corporate risk oversight guidelines
	Develop and implement hedging strategies using physical delivery arrangements and/or financial derivatives instruments
	Quantify fuel and electric market volatility
	Assess counter-party default risk
	Structure cost-effective risk management strategies
	Utilize financial options to protect contract positions