Study on risk evasion in electricity market

Abstract

The operation of electricity market brings a new chance to the insurance companies to expand their business. The fast fluctuation of electricity price different from relative stable ones in other markets is the main feature of electricity market, it makes the market participants being taken the risks of losing profits. To obtain steady revenue it is necessary to establish an effective mechanism to avoid the risk. According to the peculiarity of the risk of decreasing the revenue of the generating companies, the feasibility and necessity of led the income insurance into electricity market to avoid the risks are researched. Through the explanation of the principle of applying revenue insurance to electricity market and the calculation results for practical data from a certain provincial electricity market, it is realizable to decrease the operating risks of power generating enterprises by purchasing the income insurance, and this method possesses good prospects.