What is Price Forward Curves?

A PFC (Price Forward Curve) is a time series;

  • which comes along in the same resolution as the underlying (spot market) and/or schedules
  • Power: Hourly (HPFC) / Quarterly (QPFC)
  • Gas: Daily (DPFC)
  • which “decodes” the average futures prices in the needed time resolution
  • Can be based on settlement/end of day future prices or intraday future-price information

It is a key instrument for valuation of assets or consumption with profiled delivery structures and the answer to following questions:

  • How much is my Outcome/Income of Power (or Gas) worth?
  • What does energy typically cost on a Monday at noon in November? (For example)
  • Our green PFCs add to this with analysis and forecast of green energies and other fundamental factors
    • Pricing green (Wind/Solar) assets (PPA’s) with this has the advantage that effects like cannibalization are already modeled in the PFC