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Making Economic Sense of Electricity Prices: There's a pattern to be seen if you know where to look.(Statistical Data Included)
When electric prices quadruple over the course of a few months, many campanies that are unhedged and unprepared get hurt. Because prices will probably rise again, companies that can make economic sense of price spikes will be better prepared to manage their energy costs
External Shocks
Electricity price spikes can be caused by external shocks to the economy. A few producing countries, for example, largely control oil supply; oil is an oligopolistic market. By controlling supply, a few players effectively set the price.
The ripple effects of a shock depend upon its timing, magnitude, and type, and we cannot completely insulate ourselves from ...
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