The market risks encountered by energy asset operators can be categorized as short term/operational, intermediate term/trading, and long term/valuation in nature. This paper describes how the market risks in operations can be measured and managed using real option models and stochastic optimization techniques. It then links these results to intermediate term value at risk and related risk metrics such as cash flow, earnings, and credit risk which can be used to measure trading risks over weeks to months; and how to optimize these portfolios for risk-return relationships. Finally, it then explores the risks in longer term energy portfolio management and how these can be simulated, measured, and optimized. Index Terms-Earnings at risk, energy risk management, portfolio optimization, potential credit exposure, real options, value at risk. Michael Denton, photograph and biography not available at the time of publication.

No abstract

No abstract

No abstract

No abstract