Course 12 of 20 · Power Origination and PPA Desk Academy

Long-Term Pricing & PPA Economics

Stage C, Settlement and pricing. Level 7 of 10.

Building a full-term price and valuation from capture, basis, curtailment and settlement inputs, including strike derivation and sensitivity testing.

127 chapters · 12 modules · every chapter one 8 to 10 minute explainer · builds on: Course 06, Course 07, Course 11

Enrol or enquire See the 127 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

12 modules · 127 chapters

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

M0 What a Full-Term Price Has to Answer Ch 1-10
  1. The Single Number an Origination Desk Has to Defend
  2. Strike, Capture Price and Merchant Revenue Are Three Different Quantities
  3. Whose Seat the Term Price Is Built From
  4. Why a Long Contract Is Not Simply a Distant Forward Quote
  5. Deriving a Price Against Defending It
  6. What This Material Inherits on Capture and Basis
  7. What This Material Inherits on Curtailment and Availability
  8. Taking the Settlement Mechanic as Already Agreed
  9. Four Threads This Material Opens and Hands On
  10. The Order a Term Price Is Built In
M1 Every Input Sourced, Dated and Graded Ch 11-21
  1. No Figure Enters a Term Price Without a Named Origin
  2. An Illustrative Strike Is a Demonstration, Not a Quotation
  3. Quotation, Observation, Model Output or Placeholder
  4. How Fast Each Class of Input Goes Stale
  5. Reading a Developer's Price Model Before Believing It
  6. The Input Register as a Document With an Owner
  7. Units, Currencies and the Conversions That Hide Errors
  8. Nominal or Real: The Choice That Changes Every Later Number
  9. Where a Forward Quote Stops and an Assumption Starts
  10. Deliberate Simplifications and the Constraints That Break Them
  11. The Input Register Filled for One Candidate Contract
M2 The Term Grid and the Volume That Fills It Ch 22-31
  1. The Contract Year as the Unit the Price Is Built On
  2. Choosing a Tenor and Paying for the Choice
  3. Expected Annual Generation and Where the Estimate Comes From
  4. Degradation Across the Term and the Volume It Removes
  5. Interannual Variation Is Not Degradation
  6. The Commissioning Window and the Volume It Puts at Risk
  7. Contracted Percentage: Pricing a Share of Output
  8. Aggregating Settlement Periods Into an Annual Figure
  9. Term Start, Term End and the Periods Nobody Prices
  10. The Volume Column Finished and Checked
M3 Carrying Capture, Basis and Curtailment Into a Term Price Ch 32-43
  1. Turning a Capture View Into a Term Price Input
  2. A Deeper Capture Discount Lowers the Strike a Buyer Will Pay
  3. The Same Discount Raises the Strike a Seller Must Require
  4. Locational Basis as a Term Deduction
  5. Cannibalisation Over a Long Term Is an Assumption, Not an Observation
  6. The Capture Path Argument and Its Assumptions
  7. Curtailment Removes Volume, and Volume Carries the Revenue
  8. Deemed Generation Pays for Volume Never Delivered
  9. Negative Price Stops Priced as a Term Deduction
  10. Availability Obligations and the Price of Promising Them
  11. Three Deductions Applied Without Double Counting
  12. The Deduction Stack Closed on One Illustrative Term Grid
M4 The Merchant Baseline the Strike Is Measured Against Ch 44-53
  1. The Uncontracted Asset as the Comparison That Matters
  2. Using Quoted Periods Where They Exist
  3. Extending a Baseline Beyond the Last Quote
  4. A Fundamental Build as One Way to Reach the Far Years
  5. Buying a Third Party Forecast and Owning It Anyway
  6. Two Forecasts That Disagree, and What to Do With Both
  7. Applying the Asset's Own Shape to a Baseline Price
  8. Support Revenue Inside or Outside the Baseline
  9. The Route to Market Cost the Baseline Must Carry
  10. The Baseline Written Down as a Dated Case
M5 The Seller's Revenue Requirement and Its Floor Ch 54-63
  1. The Lowest Price a Seller Can Sign and Why It Exists
  2. Operating Cost Per Unit of Delivered Energy
  3. Network and Use of System Charges Across a Long Term
  4. Land, Lease and the Payments That Follow Revenue
  5. Turning Build Cost Into an Annual Charge the Strike Must Cover
  6. The Discount Rate Is an Assumption, Never a Market Fact
  7. Tax, Allowances and the Part of the Floor Nobody Agrees On
  8. A Curtailed Hour Costs Only the Costs That Follow Output
  9. An Operating Asset's Floor Against a Project's Floor
  10. The Floor Closed and Pressure Tested
M6 Deriving the Strike Ch 64-75
  1. The Strike Defined as the Price That Makes Two Figures Equal
  2. Solving for a Flat Strike Across Every Contract Year
  3. Why the Volume Weighting Decides the Answer
  4. Deriving a Strike From the Merchant Baseline Instead
  5. When the Floor Sits Above the Market and the Deal Does Not Exist
  6. The Risk Premium Added for the Term Beyond Any Quote
  7. Pricing the Credit Standing of the Party on the Other Side
  8. The Strike for a Sleeved Delivery Carries a Fee Stack
  9. The Attribute Value Inside or Beside the Strike
  10. A Strike Quoted Per Unit Against a Fixed Annual Payment
  11. Checking a Derived Strike Before It Leaves the Desk
  12. A Strike Derived End to End on One Illustrative Contract
M7 The Buyer's Price for the Same Contract Ch 76-85
  1. The Buyer's Seat and the Number It Produces
  2. The Buyer's Alternative Is a Supply Tariff, Not a Wholesale Curve
  3. Which Parts of a Buyer's Bill the Contract Actually Reaches
  4. Valuing Budget Certainty Without Overstating It
  5. The Buyer's Discount Basis Is Not the Seller's
  6. A Buyer Who Resells Output Carries the Capture Discount
  7. Pricing a Volume the Buyer Cannot Use
  8. The Internal Approval Threshold as a Price Constraint
  9. The Zone of Possible Agreement Between Two Derived Prices
  10. Reconciling a Seller's Price With a Buyer's Price
M8 Settlement Choices That Move the Price Ch 86-94
  1. Why an Agreed Settlement Mechanic Changes the Strike
  2. The Reference Price Chosen and the Strike It Implies
  3. Settlement Granularity Priced, Not Just Specified
  4. Who Pays When the Reference Price Goes Below Zero
  5. Imbalance Exposure Priced Into the Strike
  6. Invoice Timing, Payment Terms and the Money Between Them
  7. Metering Point, Losses and the Quantity the Strike Multiplies
  8. Change in Charges and the Clause That Passes It Through
  9. The Settlement Adjustments Totalled and Attributed
M9 Valuing the Contract Across Scenarios Ch 95-105
  1. Price and Value Are Separate Questions
  2. The Difference Stream a Contract Creates
  3. Discounting a Long Difference Stream
  4. Building Scenarios a Committee Will Accept
  5. Weighting Scenarios and Stating the Weights
  6. The Mean of the Payoffs, Not the Payoff at the Mean
  7. Where This Material Stops Pricing Optionality
  8. The Distribution of Outcomes, Not Just Its Centre
  9. The Worst Case That Is Not the Worst Case
  10. Mark to Market on a Contract With No Market
  11. The Contract Valued From Both Sides at the Agreed Strike
M10 Sensitivity, Stress and Defending the Number Ch 106-116
  1. Sensitivity Testing Comes Before the Offer, Not After the Challenge
  2. Sensitivity to the Achieved Price View, With the Direction Stated
  3. Sensitivity to Tenor and the Widening It Produces
  4. Sensitivity to the Volume Column
  5. Sensitivity to the Discount Rate Assumption
  6. Moving One Input at a Time Understates the Range
  7. Ranking the Inputs by How Much They Move the Answer
  8. Running the Build Backwards From a Price the Buyer Named
  9. Why an Offer Should Carry a Band, Not a Figure
  10. The Three Questions That Come Back at a Quoted Strike
  11. Maintaining a Term Price Between Enquiry and Signature
M11 A Worked Term Price and the Limits Ch 117-127
  1. A Worked Contract, Part One: The Asset, the Buyer and the Register
  2. A Worked Contract, Part Two: Volume, Deductions and the Baseline
  3. A Worked Contract, Part Three: Solving for the Strike
  4. A Worked Contract, Part Four: The Buyer's Answer to the Same Question
  5. A Worked Contract, Part Five: Testing and Deciding
  6. The Offer Letter That Carries the Strike
  7. Comparing Two Offers That Differ on More Than Price
  8. Handing the Price Build to the Clause Designers
  9. Handing the Price Build to the Lender and the Accountant
  10. Why One Contract's Price Is Not a Portfolio Answer
  11. What a Term Price Cannot Tell You

The brochure gives each of these 127 chapters a paragraph on what it covers and what you can do once you have worked through it.

This is course 12 of twenty

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

Enrol or enquire See the whole pathway