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Who is hedging energy cost in this scenario? As I understand if, the risk isn’t actually moving from the homeowner, it’s just an accounting trick where they pay
by pgwhalen 4y ago
Who is hedging energy cost in this scenario? As I understand if, the risk isn’t actually moving from the homeowner, it’s just an accounting trick where they pay upfront but get a tax rebate.
My point being, if homeowners aren’t hedging energy costs now, why would they begin to?
- jnsaff2 4y agoBank? Developer? Whoever has to package it in and therefore has to hedge it as well.
- pgwhalen 4y agoYou’re missing my point, or you’re reading GP in a way that I am not. Paying up front for expected energy usage does not place the risk (future price variation) on the bank. It’s just a lump sum. There’s nothing for the bank to hedge.
- jnsaff2 4y agoI totally just wrote down my thoughts that came into my mind reading the GP. Not arguing with you. Tho I don't see how you could ever "pay up front" for energy for that long of a period without someone doing a futures deal. As a person especially today the energy prices fluctuate wildly. Edit: making a hedge for your energy for the lifetime of the building (or yourself) does not in any way negate the idea of the GP. TCO is still made explicit and the energy part can be compared with other buildings and smarter decisions about insulation will be made which should drive developers into building better.