TFS Energy Successfully Hosts a Weather Derivatives Auction
NEW YORK, October 10, 2006 - TFS Energy, LLC today announced its weather derivatives division solicited bids, on behalf of a client hedging their temperature-related business risk, for Heating Degree Day (HDD) swaps for the period November 2006 through March 2007 at: Casper, Wyoming; Denver, Colorado; Grand Island, Nebraska; and Grand Junction, Colorado. All formal offers came through TFS Energy and had to be received by 11:30 A.M. EST, Wednesday, September 27, 2006. The auction transferred in excess of $4,500,000 of risk.
TFS Energy has hosted numerous auctions, including Dutch auctions, which ranged in magnitude from $1MM to upwards of $70MM of transferred risk. Its weather desks are located in Stamford, London, and Sydney.
Editor Notes on the Auction
Offers were accepted in minimum tick increments of: $1,546 per HDD with a corresponding cap of $1,002,000 for Casper, Wyoming; $822 per HDD with a corresponding cap of $426,000 for Denver, Colorado; $1,351 per HDD with a corresponding cap of $1,066,000 for Grand Island, Nebraska; and $2,729 per HDD with a corresponding cap of $2,014,000 for Grand Junction, Colorado.
In the event of multiple successful offers, all offers were filled until the entire tick/cap capacity for the structure was exhausted. All clearing prices received the clearing level for their price.
Inquiries
| Kendall Johnson, Head of Weather Derivatives Group | +1.203.967.0427 |
| Jennifer Van Hofwegen, Head of Marketing and Communications | +1.212.791.6491 |