Guidebook for Evaluating Fuel Purchasing Strategies for Public Transit Agencies (2012) / Chapter Skim
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Pages 35-38
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35 Summary and Evaluation of Hedging Instruments Evaluating the effectiveness and appropriateness of different hedging instruments is not a straightforward exercise. A one-size-fits-all solution for managing energy price risk does not exist.
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36 Guidebook for evaluating Fuel Purchasing Strategies for Public transit Agencies • Web-Based Price Protection Programs -- Online programs such as Pricelock, Fuel Bank, and MoreGallons offer fuel price protection that is similar to a cap (purchased call option)
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From page 37... ...
Summary and evaluation of Hedging instruments 37 Table 5.1. Comparison of major hedging instruments.
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38 Guidebook for evaluating Fuel Purchasing Strategies for Public transit Agencies 5.4 Appropriateness of Hedging Instruments There is no one-size-fits-all hedging instrument for every transit agency. Each agency must evaluate its own fuel procurement process, price risks, and price management goals before selecting the hedging instrument that best fits the agency's needs.
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