Course 08 of 20 · Hydrogen Desk Academy

Pricing Formulae & Indexation

Stage B, Policy, certification and offtake. Level 4 of 10.

Building price formulae where no liquid hydrogen reference price exists: proxy index selection, pass-through of power cost, floors, caps and reopener mechanics.

129 chapters · 11 modules · every chapter one 8 to 10 minute explainer · builds on: Course 04, Course 06, Course 07

Enrol or enquire See the 129 chapters
How a chapter is delivered

One chapter is one idea taken to the point of use

Each chapter covers one idea to the point where you can use it, and comes two ways: a narrated explainer, and a deep dive audio discussion of around thirty minutes that works the same material at depth.

Self-paced throughout, and the same chapters can be taught as a cohort. Chapters run in order: each one assumes only what the chapters before it taught, and capability belonging to a later course is named and deferred rather than half-covered.

Curriculum

11 modules · 129 chapters

Open any module for its full chapter list, in teaching order.

M0 No Reference Price, and No Date When One Arrives Ch 1-11
  1. The Quote a Hydrogen Seller Cannot Look Up
  2. Assessed Levels Are Not Transacted Levels
  3. Why No Venue Settles Hydrogen in Size
  4. Drafting for a Market That May Never Arrive
  5. Reading an Assessment Methodology Before Citing It
  6. Auction Awarded Levels as a Rare Public Number
  7. Which Seat the Clause Is Written From
  8. What the Delivered Cost Stack Hands This Work
  9. What the Signed Offtake Hands This Work
  10. Four Routes to a Price When Nothing Is Quoted
  11. What a Defensible Pricing Clause Must Carry
M1 Choosing a Proxy Index and Auditing It Ch 12-24
  1. What a Proxy Index Is Asked to Do Here
  2. What Makes a Candidate Index Usable at All
  3. Natural Gas Quotations Behind Unabated Hydrogen Value
  4. Adding an Allowance Leg Beside the Gas Leg
  5. Electricity Indices Standing In for Electrolytic Cost
  6. Ammonia Assessments as a Delivered Hydrogen Proxy
  7. Methanol Reference Prices as a Formula Input
  8. Indexing to the Product a Captive Buyer Displaces
  9. A Proxy Relationship Is a Tendency, Not a Law
  10. Naming What Would Break the Chosen Proxy
  11. Pricing Without the Correlation Evidence Nobody Has
  12. When the Proxy Stops Being Representative Mid-Term
  13. Writing the Reference So One Number Results
M2 Building a Price From the Cost Stack Ch 25-36
  1. The Cost-Based Formula in Outline
  2. The Denominator the Price Is Quoted On
  3. Which Cost Lines Belong Inside a Formula
  4. Turning a Capital Recovery Charge Into a Constant
  5. The Volume Assumption Hiding in Every Fixed Charge
  6. Escalating the Fixed Component Against Inflation
  7. A Plant Cost Index Inside a Capital Term
  8. Open Book and Closed Book Cost Pricing
  9. Stating the Margin or Burying It
  10. The Objection to Pure Cost-Plus Pricing
  11. The Cash Cost Line the Seller Cannot Price Below
  12. A Cost-Based Price Assembled, Illustratively
M3 Power Cost Inside the Formula Ch 37-50
  1. Why Power Dominates and the Clause Must Say So
  2. Absorb, Pass Through or Band: The Three Treatments
  3. A Pass-Through Moves Power Risk to the Buyer
  4. A Fixed Price Leaves Power Risk With the Seller
  5. Which Power Number the Clause Reads
  6. Passing Through a Day-Ahead Outcome
  7. Passing Through a Forward Settlement Instead
  8. The Consumption Coefficient That Converts Power to Hydrogen
  9. Who Carries Stack Degradation Over the Term
  10. Grid Charges, Levies and the Edge of the Pass-Through
  11. Curtailed Hours and a Pass-Through That Buys Nothing
  12. A Capped Pass-Through: the Seller Grants the Cap
  13. What a Pass-Through Invoice Must Evidence
  14. A Power Pass-Through Computed, Illustratively
M4 The Other Legs the Formula Carries Ch 51-60
  1. Carbon Intensity as a Priced Term, Not a Warranty
  2. Sizing the Deduction for Intensity Above Target
  3. Paying More for Intensity Better Than Promised
  4. A Certificate Leg Priced Separately From the Molecule
  5. Carbon Dioxide Transport and Storage as a Formula Line
  6. Feedstock Gas as a Passed-Through Input
  7. A Currency Leg When Cost and Sale Diverge
  8. Transport and Delivery Charges Inside or Outside the Price
  9. The Order of Operations in a Multi-Leg Formula
  10. Reading a Four-Leg Formula Aloud and Checking It
M5 Indexing to the Buyer's Alternative Ch 61-71
  1. The Alternative the Buyer Would Otherwise Buy
  2. Pricing at a Discount to the Displaced Input
  3. A Share-of-Savings Formula and Who Benefits
  4. When the Alternative's Price Collapses
  5. When the Alternative Is Itself Barely Traded
  6. Blending a Cost Leg With an Alternative Leg
  7. Weights That Step Through a Long Term
  8. Choosing Between a Cost Anchor and a Market Anchor
  9. Two Offers on One Requirement, Compared
  10. The Fixed Price Nobody Should Quote Blind
  11. Indexed and Fixed Allocate Opposite Exposures
M6 Floors, Caps and Collars Ch 72-84
  1. A Floor Protects the Seller and the Buyer Grants It
  2. A Cap Protects the Buyer and the Seller Grants It
  3. The Collar and What Each Party Surrendered
  4. Setting the Floor at the Cash Cost Line
  5. Setting the Cap at the Buyer's Walk-Away Level
  6. A Floor on the Pass-Through Rather Than the Price
  7. A Cap Written as a Maximum Annual Increase
  8. A Floor That Escalates With the Fixed Component
  9. Sharing Bands Between the Floor and the Cap
  10. Reading a Drafted Collar Back to Its Direction
  11. Drafting Errors That Invert a Floor or a Cap
  12. A Floor the Lender Needs and the Buyer Resists
  13. Why a Floor Does Not Make a Project Safe
M7 Valuing a Limit Ch 85-94
  1. Why a Limit Has a Value With No Market to Quote It
  2. Building the Index Scenarios the Valuation Needs
  3. Evaluate the Payoff in Each Scenario, Then Average
  4. Why Averaging the Index First Understates a Floor
  5. The Concession a Seller Should Seek for a Cap
  6. What a Buyer Should Charge for Granting a Floor
  7. A Collar Valued as Two Payoff Sets
  8. Scenario Weights and How to Defend Them
  9. Valuing a Reopener as a Right, Not a Formality
  10. What This Valuation Cannot Settle
M8 Reopeners, Review and Reference Failure Ch 95-107
  1. What a Price Reopener Actually Does
  2. Time-Based Triggers and Their Calendar
  3. Threshold Triggers Tied to a Named Index
  4. Event Triggers: A Pathway, a Policy or a Plant
  5. Who May Call a Review and How Often
  6. The Standard the Reviewer Must Apply
  7. The Evidence a Calling Party Must Produce
  8. The Price That Applies While a Review Runs
  9. When the Parties Fail to Agree a New Price
  10. The Referenced Index Ceases to Be Published
  11. Benchmark Governance and Why the Clause Should Care
  12. A Methodology Change That Moves the Price
  13. Reopening Because the Proxy Stopped Representing
M9 Testing a Formula Before Signature Ch 108-118
  1. Computing the Formula at Three Index Levels
  2. The Sensitivity Table a Negotiator Takes to the Room
  3. Can This Formula Produce a Negative Price
  4. Checking the Price Against the Cash Cost Every Year
  5. Checking the Price Against the Buyer's Ceiling
  6. The Publication Calendar Check
  7. Rounding, Precision and the Invoice That Results
  8. Two Parties Computing One Formula and Disagreeing
  9. Internal Challenge Before the Clause Is Signed
  10. The One-Page Formula Summary
  11. The Pre-Signature Checklist
M10 Two Formulae Worked, and the Limits Ch 119-129
  1. Case One: A Domestic Refinery Offtake Introduced
  2. Case One: Building the Clause
  3. Case One: Defending It to the Buyer's Committee
  4. Case Two: An Ammonia Export Offtake Introduced
  5. Case Two: Choosing the Proxy and the Collar
  6. Case Two: Pricing the Collar and the Reopener
  7. The Two Cases Compared
  8. Reading Both Clauses for Reversed Direction
  9. What These Formulae Cannot Do
  10. What the Clause Hands to the Hedging Desk
  11. Where the Price Term Goes Next

The brochure gives each of these 129 chapters a paragraph on what it covers and what you can do once you have worked through it.

This is course 8 of twenty

It stands alone, and it is also the entry point to the Hydrogen Desk Academy pathway.

Enrol or enquire See the whole pathway