Research On Financial Risk Management In Municipal Power Company

In our country,the power company is split into two types of entities with different interest, that is, electricity grid and power generating companies. The municipal power company is in charge of the main power grid company's electricity sale businesses, which directly face the competition market, thus faced with a variety of financial risks. In this paper, firstly, the meaning of risks and financial risks is introduced, and considering the municipal power company's current risk management, the sources and classifications of financial risks in the municipal power company is analyzed, namely: credit risk, commodity risk, operational risk, which specifically include six categories: risk of electricity sale cost and purchase costs, electricity price risk, risk of power purchase contract design, risk of electricity fee recovery, users Fault Tolerant risk, and operational risk . And then, based on VAR Risk Pricing Model principal, commodity risk and credit risk are measured in a quantitative way, and operation risk is analyzed qualitatively in the risk report. With the actual data of abc City Power Company, the financial risks of the power company is evaluated. Finally, the strategies and recommendations for managing these financial risks in the municipal power company are presented.