case studies
Maximizing Value in the Face of Wind Energy Disruption
In 2018, following the acquisition of several gas generation plants on Long Island, an international merchant power company faced a tough decision in the wake of New York's Governor announcing a massive 9,500 MW wind energy project off Long Island's northeast coast. With fear of insolvency and dramatic erosion of asset values, they reached out to ArrowHead, whose custom-tailored models showed that an alternative, profitable, outcome was achievable.
Challenges
- 01
New Competition
- 02
Supply & Demand
- 03
Asset Management
ArrowHead's primary task was to evaluate the impact of the planned 9,500 MW of offshore wind on power prices in Long Island and the broader Northeast region.
The results spoke for themselves, and the company reaped the rewards of their analytics-driven decision-making. By relying on the model's price trends, they retained ownership of their plants and continued to receive good operating times, good revenue- and margin-recovery and thereby to retain their high value. Rather than selling them at fire sale prices, they kept them and realized the hundreds of millions of dollars in profit that the new owner (not they) would have reaped. It made hundreds of millions of dollars for their shareholders.
Scroll