  We propose a multi-factor polynomial framework to model and hedge long-term
electricity contracts with delivery period. This framework has several
advantages: the computation of forwards, risk premium and correlation between
different forwards are fully explicit, and the model can be calibrated to
observed electricity forward curves easily and well. Electricity markets suffer
from non-storability and poor medium- to long-term liquidity. Therefore, we
suggest a rolling hedge which only uses liquid forward contracts and is
risk-minimizing in the sense of F\"ollmer and Schweizer. We calibrate the model
to over eight years of German power calendar year forward curves and
investigate the quality of the risk-minimizing hedge over various time
horizons.
