Please use this identifier to cite or link to this item:
Appears in Collections:Economics Working Papers
Peer Review Status: Unrefereed
Title: Contract Parameters' Impacts on Coal Prices
Authors: Lange, Ian
Contact Email:
Citation: Lange I (2008) Contract Parameters' Impacts on Coal Prices. Stirling Economics Discussion Paper, 2008-26.
Keywords: Tradable Permits
Sulfur Dioxide
JEL Code(s): Q48
Issue Date: Nov-2008
Series/Report no.: Stirling Economics Discussion Paper, 2008-26
Abstract: The use of long-term contracts in the procurement of coal for electricity generation is common. The data that is observed from contracts and their transactions are from different levels of the pricing process. Contracts contain the parameters by which all future deliveries are structured, specifying the length of the agreement and acceptable coal attributes. Based on these parameters, a price is later determined for successive coal deliveries and the transaction occurs. This data structure fits well into multi-level models, where each level of the process is empirically estimated. A random intercept model is estimated where the first level is a hedonic model of coal prices. The contract that initiates the delivery is used to connect the two levels of the model. In the second level, contract coefficients from the first level are regressed on contract parameters to determine their impact on how coal is priced. Results find that many contract parameters are statistically significant in the price of coal.
Type: Working or Discussion Paper
Affiliation: Economics

Files in This Item:
File Description SizeFormat 
SEDP-2008-26-Lange.pdf200.67 kBAdobe PDFView/Open

This item is protected by original copyright

Items in the Repository are protected by copyright, with all rights reserved, unless otherwise indicated.

If you believe that any material held in STORRE infringes copyright, please contact providing details and we will remove the Work from public display in STORRE and investigate your claim.