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Ponca City Cogeneration Plant

Bodily, Samuel E.

Case

Ponca City Cogeneration Plant

Bodily, Samuel E.

QA-0469 | Published September 15, 1994 | 6 pages Case

Collection: Darden School of Business

Product Details

An electric utility faces the hard choice between losing their third largest customer or building a cogeneration plant that is very risky to them and appears to take value away from the firm. Students first assess their strategic position and the magnitude of the risk, in the process improving the assumptions of the discounted cash flow spreadsheet model available to them. The task is then to be shrewd and creative in reducing and managing the risk of the project, which, after all, is manageable.

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