Banks shock commodities models by 1,000% in stress-test rethink

Energy price spikes force clearing firms to consider extreme or even ‘implausible’ scenarios

Energy spikes

On the week of February 15, 2021, futures prices for electricity on Texas’s power grid increased by 12,000%, to the price cap of $9,000 per megawatt hour. The state had been hit by a huge snowstorm which wiped out its energy capacity, as snow blocked solar panels and sub-zero temperatures froze wind turbines and natural gas wells.

“This was just through the roof,” said the head of risk at one clearing firm at the time. “This is one to look at and say: ‘What’s going down here? Is this really

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact info@risk.net to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Risk.net? View our subscription options

Most read articles loading...

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here