Utilities shift towards longer-term hedging

Tim Simard, managing director in the energy derivatives team at National Bank of Canada, first established that 93% of the 90-odd conference audience had an active commodity-hedging programme. Of course, this was not surprising, given the nature of the conference, Simard pointed out.

Of these, he found that fully one-fifth (19%) have a maximum permitted term for their hedging activity of more than three years – a surprisingly high number, he said. “Most have tended to hedge the current or n