The addition of the department has been part of Basin Electric’s evolution – from a one unit power generation resource to a generation fleet fueled by coal, gas, oil, nuclear, heat recovery and wind; thousands of miles of transmission line; and eight subsidiaries.
It’s also been an opportunity to reevaluate the cooperative’s risk tolerances relating to its commodities and assets.
The new department is featured in the July-August 2013 issue of Basin Today, Bringing it inside: Marketing & Trading preparing to manage Basin Electric’s commodity risks.
Read an excerpt:
New resources, commodities, load growth and participation in markets have modified the cooperative’s portfolio. The impacts of those changes were folded into the mix, and in some cases, isolated as unique business entities. Over time, these adjustments grew the commodity risk profile of the organization and created pockets of isolated risks.
Basin Electric’s commodities include its energy market exposure for its baseload generation assets, like Antelope Valley Station; its wind projects; the gas peaking units, like Groton Generation Station; the member and non-member loads; natural gas at Dakota Gas, as well as the tar oil and other byproducts and co-product; and Dakota Coal’s diesel fuel exposure.
A new organizational structure provided an opportunity to open the cooperative umbrella and take a broad look at all of Basin Electric’s resources and commodities and how they relate to each other.
In mid-2012, Serri named Ken Rutter vice president of the Marketing & Trading department, and since joining the Basin Electric team Rutter has been working with the other managers to clearly define the group’s role within the cooperative.
“The first thing we did was get an understanding of all Basin’s commodity positions and the potential impact these commodities could have on Basin’s rates,” Rutter says. “We had to look at all those commodities together and how they interact with each other.” Read more…