Liberty power plant contract termination
In a dispute over damages from a prematurely terminated long-term power tolling contract, Brattle provided presented testimony on why calculating the present value of those damages required the use of two distinct discount rates: one (a low rate) for the revenues lost under the low-risk terminated contract, and another, much higher rate for the valuation of the replacement revenues in the risky, short-term wholesale power markets. This risk differentiation was important because the average undiscounted value for the lost, fixed-price contract revenues was somewhat lower than for the expected spot market revenues that would replace it. Nonetheless, there were significant damages under a two-discount rate calculation, reflecting the attractiveness of the secure contract. This position was adopted by the court.