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ChrisCook:
The risk is that the turbine cannot produce - over its life - sufficient energy to redeem all of the energy units sold.
Do you really propose to sell energy units, or fractions of actual production? I assumed the latter in the comment where I crunched the numbers, in which case the risk is that the energy that the shareholder is entitled to over the life of the turbine will amount to less than the money invested would have been able to buy at market prices. That is, the risk is not that energy units won't be redeemable, but that the amount of energy per share will be less than originally expected.

Selling the actual energy production forward differs very little from selling a revenue amount forward. I thought your model involved selling shares of production, whatever that will be in the future, rather than selling a fixed amount of KWh.

We have met the enemy, and he is us — Pogo

by Migeru (migeru at eurotrib dot com) on Sat Jan 19th, 2008 at 12:42:40 PM EST
[ Parent ]
Ideas develop over time, and I bore people on ET quite enough without airing every development.

It wasn't that long ago (a few months) that it occurred to me that there are two forms of "Equity" possible:

(a) Proportional shares, giving indefinite rights to streams of production; and

(b) "Redeemable" shares redeemable in units of production, but not conferring any "income".

One could do either, or both, technically, but that could get messy.

But it's the "units" that have the most potential I think.

Selling the actual energy production forward differs very little from selling a revenue amount forward.

True. Because "revenues" consists of the sale proceeds of energy expressed in conventional currency.

But denomination in MwH and Btu equivalent etc could allow us to integrate the energy content of carbon based fuels into a coherent "carbon dollar" market and an "energy clearing union" framework.

As opposed to the trading/clearing of units of carbon content of CO2 brought to us by intermediaries.

The creation of pools of energy units in this way gives us the basis of a globally fungible asset class.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Sat Jan 19th, 2008 at 01:42:28 PM EST
[ Parent ]

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