Risk glossary

 

Auctioning

As applied to the energy sector, auctions as a pricing mechanism have been used, or have been planned, for: electricity (usually day ahead); liquefied natural gas (LNG); storage capacity, emission allowances; transmission capacity; cross-border transmission; and grid or pipeline entry and exit capacity, in order to manage congestion. Also used as a means of periodically allocating upstream geographical exploration and production rights.

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