Mistral Energy: A Tale of Two Power Markets Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Mistral Energy is contemplating to manufacture a $40 million power plant in close area to both the Alberta and Saskatchewan power marketplaces. The Alberta marketplace is deregulated and price fluctuates hourly along with supply and demand. The Saskatchewan market, on the other hand, is a controlled monopoly. It must be comprehended by Mistral Energy in which market their power should be sold. Mistral is very thinking about what power price would make the business indifferent between marketplaces since the costs obtainable in Saskatchewan are unknown. Moreover, as the power plant is approximately equidistant between Alberta and Saskatchewan transmission lines,

Mistral Energy A Tale of Two Power Markets Case Study Solution

It might be possible to select between markets on an hourly basis. Mistral is interested in investigating the worthiness of the inter-marketplace connection. Regrettably, for technical reasons, this switch isn't instantaneous, and the plant must be shut down for thirty minutes before supplying electricity to another marketplace. Another challenge is calling when the power price in Alberta will not be lesser than the contract price obtainable in Saskatchewan. Besides the upcoming Alberta price is not known and highly fluctuating, the risk that sustains is that elated prices must not be sustained long enough for Mistral to realize the value.

PUBLICATION DATE: May 29, 2014 PRODUCT #: W14190-PDF-ENG

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