It’s Time for “Trial-and-Error Trading” to End

A think tank session for energy traders will encourage innovative thinking amongst energy traders.
Published: Tue 23 Sep 2014

The EMART Energy conference will be hosting many experts on site, creating a great opportunity to exchange ideas, network and discuss very specific topics. This is the opinion of Capgemini Consulting’s Torben Schuster, Principal of Energy Trading, who will be leading a think tank session at the event.

Energy traders get to discuss challenges and opportunities

Last year, Capgemini Consulting published an insightful report, Energy Trading 2.0: Status quo and future challenges:a best practice survey by Capgemini Consulting [pdf] and they are currently preparing the 2014 survey results based on feedback from 120 European energy trading companies. The report has been compiled in close relation with the European Federation of Energy Traders (EFET). Capgemini Consulting will present the key insights, results and conclusions to energy traders at the conference in the form of a think tank session, Energy Trading 2.0: Current challenges and the way forward.

The session will be a platform for the discussion and creation of innovative ideas for the future of energy trading companies. The discussions will be carried out in a very interactive and collaborative environment.

Schuster states, “These discussions are meant to encourage people to use (and manage) new ideas to improve current systems and processes and challenge existing business models. As the energy trading sector requires very specific know-how, it’s critical that experiences from “outside” discussions are exchanged, considered and expanded upon so that operations can be improved and costs lowered.”

Capgemini Consulting experts will guide the participants through concrete but provocative examples of possible energy trading strategies, operations, processes and IT developments. There will be four groups of participants and topics will be discussed and argued for approximately 90 minutes.

Topics that Capgemini will be covering include:

  • Drivers of sustainable success – from business model to value-adding innovation management
  • Is paper trading dead or will it be revitalized – the trends in energy trading
  • How to maximize profit of complex contracts – is there a border of efficiency?
  • Beyond Gross Margin – How to strengthen energy traders’ support functions and IT
  • How to incentivize and steer energy traders in the future

The results of the think tank will be collated and presented in a short feedback session the next morning at the Capgemini Consulting booth.

Energy trading industry – time to mature

Schuster points out that it is time for the energy trading industry to scale up and mature. He explains, “If you look at the energy market, there is still a lot of gambling. There are opportunities but if you look at a lot of traders, most of them operate by trial and error, focussing on speed, but unfortunately they tend to forget the direction. Now, with the new regulations in place, markets are not as volatile as before. Trial and error trading is very costly with the new regulations and traders should question their modus operandi and focus on improving efficiency and cost-effectiveness. Traders really need to know their KPI’s and should try to follow clear strategies – a balancing act is now needed.”

In conclusion

“It’s not very often that you get to discuss topics with such a variety of experts and we welcome both positive and negative feedback at the event.”

Capgemini will be discussing how utilities can use technology to their benefit in our webinar Exploit the Power of New Technologies with Capgemini on the 23 April 2015.