Load Profile and Volume Risk
A load profile spreads volume across hours; volume risk is the deviation between forecast and realised load.
Consumers and supply contracts are defined by load profiles: how much power is used in each hour of a day or season.
Volume risk arises when actual consumption deviates from forecast, creating imbalance exposure to spot prices.
Portfolio valuation must combine price risk with profile and volume risk, not just assume fixed quantities.
This plot shows a forecast load profile and a realised profile over 24 hours, with an underlying spot price curve. The area between the curves is volume risk; when deviations occur in expensive hours, imbalance cost is high.
A load profile is a vector of hourly quantities. Volume risk is the difference between forecast and realised profiles, hour by hour.
The same total volume error can be benign or painful depending on where it falls relative to prices. The mental model: valuation and risk must combine price paths with profile and volume uncertainty, not just multiply a single price by a single quantity.