Demos
Bite-Sized DemosModeling Power Purchase Agreements in Molecule
June 5, 2025 | 4:26
Transcript
Tamasin FordChief Projects Officer, Molecule
Narrator Hello and thanks for watching. This video provides a brief demo and general overview of how Molecule models long-term hourly PPAs. If you have any questions about Molecule that are more specific to your organization, we're happy to show you more. Reach out to us for a custom demo via our website at molecule.io. Enjoy the demo.
Tamasin In this bite-sized demo, I'll walk you through how Molecule models long-term hourly PPAs, using a combination of sophisticated tools that we have available in the system.
Tamasin The first tool is our as-generated trades. The purpose of an as-generated trade is to have shaped volumes, and you enter those shaped volumes as an asset or forecast in the system. You then link your trade to that asset, and you enter a percentage-based quantity. The volumes are then dynamically pulled from the asset, multiplied by the percentage at each valuation, so that your shaped valuation can actually change over time with, say, an updated forecast, and it will always be up to date.
Tamasin Our second feature that we use in PPA modeling is the cascading trade. In this case, you enter it as a single monthly trade, and the system breaks it down into daily and hourly child trades when the flow date arrives. We have no gaps or overlap because the parent trades expire and are promptly replaced by the children and then by the grandchildren. You maintain fine-grain detail in your flow month so that you can manage and settle the trades, but the outer months stay in the original monthly form, so that it's easy to view and manage your risk position.
Tamasin And the third feature that goes into PPAs is our Price Rollup formula. Formula aggregates your hourly prices and your forecast volumes back to the monthly or daily level. The way that it retains the precision of that hourly data is through a weighted average calculation, giving you a rolled-up monthly price that is ready to use in valuations and mark-to-market reporting.
Tamasin Here you can see I'm on the Assets screen, where I have asset one with Product [DEMO FORECAST.H] — hourly. Inside asset one, you can see that we have hourly volumes, which are as of a certain date, they have a contract date, and they have an interval ending. So these position values are now showing you what your volume is going to be on December 30th, 2024 at the hour interval ending at 6:00 AM. And similarly, that goes through all the hours all the way to 2400, and then starts again for the next date, back at 100. You can see this one is shaped like a solar asset.
Tamasin Moving over to the Trades screen, you now see this monthly trade here, which was entered as a cascading trade. Inside this trade, we have an as-gen dropdown in which we pick the asset and the product that we saw on the Assets page. We then put in 100% of the total to show that we are going to be taking the volumes exactly as they are in the table that we saw, and applying them to be the volumes of this trade.
Tamasin Finally, over here on the price and the mark. You see the special rollup formula, hourly_forecasted_average. Returning to the Trades screen, we can now see the cascading that has happened for the first few months here. So this is starting in April 1st, and the trade date is March 4th. On April 1st, we get a new trade, which is our daily trade that is the cascade from the monthly. And then on April 1st as well, we get a new trade, which is the hourly cascading. If we go look at the daily trade, we'll see that it has the same setup with the as-gen linkage preserved from its parents, the price for the rollup preserved from its parent as well, and the mark.
Tamasin If we go down another level and look at an hourly, we'll see the same thing. In this case, the hourly product is now once again pulling the volumes from the same asset, actually linking to the final mark here, and the hourly forecasted average price. So this mark is going to be where we load our price data that will roll up through the entire as-gen feature.
Tamasin Let's take a look at market data. This price now is sitting here. It's available from February 24th, 2025, all the way to December 31st, 2026, IE, meaning interval ending from 0100 to 2400. So we have about 350,000 prices in the system, which will match up with the 350,000 hourly asset values in the system, and altogether be rolled up into the trade.
Narrator Thanks again for watching our demo video. If you have any questions about how Molecule will work for your specific business, please reach out for a custom demo at molecule.io.