Futures Energy Prices 20 th March, 2013 Ryan O’ Neill
May 06, 2015
Futures Energy Prices
20th March, 2013
Ryan O’ Neill
Schneider Electric 2
About Schneider Electric
Global Company
●Headquartered in France
● 175 year history
● $25 Billion in Annual Revenue
●Operating in 140 countries
● 130,000 employees worldwide
● 150 Product Brands
●Ranked 330 on the Fortune
500
Residential 9%
Utilities & Infrastructure 20%
Industrial & machines 24%
Data Centers 17%
Non-residential buildings 30%
Delivering Solutions for End Users
Committed to Innovation
4-5% of sales devoted to R&D
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Schneider Electric – Professional Services
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World View
Source: European Commission
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Overview of Market Place
Source: SEAI
• Heavily dependent on fossil fuels
• Net importer of energy
• Electricity Fuel Mix
• Key driver: Natural gas
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What are you paying for?
Important: This is Indicative only
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Where are energy prices going?
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Price Drivers
• Gas supply & storage
• LNG
• Weather
• Oil
• Economic Growth
• Currencies
• Shale gas?
• Renewables?
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55
60
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pen
ce p
er
therm
NBP movement (Jan 11 to Feb 13)
GY-11
GY-12
GY-13
GY-14
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50
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p/t
herm
Average 2012 UK NBP Gas Price
Average 2012 Gas Price
52.6p/t
74.3p/t
68.8p/t
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Managing Risk
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How do I manage my exposure?
• This is about your profit margin
• Remaining competitive
• A proactive approach is essential
• Timing is critical
• Business are entering into long term contracts, typically 3 years forward
• Budgetary certainty & market performance, conflicting objectives?
• Both can be achieved with the right tools and expertise
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Dynamic Risk Management
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Summary
• The only certainty is uncertainty, no easy wins
• No cheap energy prices any time soon
• Increasing charges/taxes
• The way we purchase energy needs to change
• Long term view essential for sustainable growth
• Tools and skills are available
• Business needs to leverage these tools and skills, as the benefits are significant
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Thank You
Questions?