full text:
Wells Fargo & Company (NYSE:WFC) said it will offer electricity price hedging to middle market companies to help them manage their power costs.
The hedging program -- believed to be the first offered by a major U.S. bank to middle market companies -- can benefit companies spending at least $1 million annually on electricity and also help them purchase environmental management products, including renewable energy credits, to reduce their carbon footprint and offset greenhouse gas emissions.
"As electricity costs continue their long-term upward trend, managing power costs can often mean the difference between profit and loss for many small and medium-sized companies," said Anil Suri, managing director in Wells Fargo's Financial Products Group. "All middle market companies depend on having reliable, affordable power, but many do not have in-house experts or the time to effectively manage electricity market risk. We now offer that increasingly vital service using the same disciplined approach Wells Fargo brings to its customers in other areas of financial risk management every day."
Just as interest rate and commodity hedging can protect a company's cash flow and budget from volatility, electricity hedges can help a company manage electricity pricing in concert with its physical supply contracts. "Our goal is to provide well-researched and clearly structured, cost efficient financial hedges against electricity price exposure, based on a company's geographic power consumption profile," said Suri. "We work with customers to understand their exposure and design hedging programs that allow them to manage through significant electricity price volatility across several budget years."
Hedging gives companies greater control over both short- and long-term electricity costs and protects them from potentially large year-over-year fluctuations in the price of electricity. "The program has been designed to help take the guessing out of unexpected and erratic short-term changes in the cost of energy," said Suri. "It also enables companies to focus on transitioning to renewable energy sources and energy-saving business practices."
"Wells Fargo has been at the forefront of bringing best risk management practices to middle market customers in the capital and commodity markets," said John Shrewsberry, executive vice president in Wells Fargo's Specialized Financial Services Group. "Addition of electricity hedges to the suite of products offered by Wells Fargo is an example of our continued commitment to help customers manage risk."
In addition to electricity, Wells Fargo offers interest rate, equity, credit, natural gas, metals, fuel and agricultural risk management products to its wholesale customers.
For more information: http://www.wellsfargo.com/

Share this content via:HTML: for your myspace, blog, or web site

' />
BB: for your bulletin boards or forums
URL: for your Email, IM, or link to this page