A speaker at the upcoming marcus evans Energy CFO Summit 2013 (http://www.energycfosummit.com/
With the increase of power rates, how can energy companies cut some of their costs?
Customers demand reasonable utility bills from a perspective of what they have paid in the past, and this places cost pressures on energy utilities due to increasing power rates. It is extremely important from an electric and utility perspective that safe, reliable operations be balanced with cost-cutting strategies. In order to achieve this, cost-cutting must be done in a slow and measured way.
Patience is a virtue when it comes to cost reduction. Being patient and looking for long-term sustainable savings, not just immediate gains.
What risk management strategies can you suggest in this volatile environment?
Standardized decision-making frameworks should be developed, so that issues related to risk can be consistently approached. In this way, the problems do not become about the people involved. The most important risk management strategy is driving judgment down the organization and not driving decisions up. Individuals at the management and supervisory levels should be educated on decision-making, so they can exercise proper judgment.
In terms of regulatory uncertainty, energy CFOs can work with the front line employees in order to understand their challenges and help manage risk. Efforts should also be made to directly communicate with the regulators, to get a feel for upcoming regulations. Processes can be put in place and risk mitigated.
How can shareholder value be protected?
The solution to the current problem of aging infrastructure is generally large capital projects. In this light, robust project risk management processes should be adequately identified so project level risks can be identified and mitigated. If this is not done correctly, the projects could be unsuccessful and the reputation of the shareholders involved impacted.
What opportunities should energy CFOs prepare for in the future?
The drive for capital investment is most probably going to continue into the next two decades, so attention in this area must be held.
The industry as a whole should question where the next energy resource will come from. In the US, natural gas and new nuclear resources seem to be the primary candidates.
Currently a large amount of renewable resources need to be backed up by base line resources. The fundamental question here is going to be whether natural gas will be accepted in regions that are high cost, clean energy providers.
Written by: Maria Gregoriou, Journalist
Contact: Jennifer Keljik, marketing manager
Tel: 312.540.3000 x6592
About the Energy CFO Summit 2013
This unique forum will take place at the Hotel Intercontinental, Dallas, Texas, February 25-26, 2013. Offering much more than any conference, exhibition or trade show, this exclusive meeting will bring together esteemed industry thought leaders and solution providers to a highly focused and interactive networking event. The Summit includes presentations on cost reduction mechanisms, risk management and the impact of new energy legislation.
About marcus evans Summits
marcus evans Summits are high level business forums for the world’s leading decision-makers to meet, learn and discuss strategies and solutions. Held at exclusive locations around the world, these events provide attendees with a unique opportunity to individually tailor their schedules of keynote presentations, think tanks, seminars and one-on-one business meetings.