Energy Risk Software Rankings: Powering up

This year’s Software Rankings reflect the increasing number of firms offering commodities software outside the core CTRM space

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The digitisation of the energy space is a concept currently much discussed by industry executives and chief risk officers alike. Not only is technology increasing operational efficiencies up and down the value chain but it is transforming business processes, disrupting age-old business models and even shaping relationships by introducing new ways for market participants to engage with clients, counterparties and competitors. 

As a result of technological advances, particularly in cloud computing, machine learning and artificial intelligence, the number of firms offering software that is relevant to energy risk management and trading is on the increase. In particular, an industry has grown up around energy and commodity data and analytics, as well as robotic processing automation.

Most energy firms now engage with some outside providers for some of their data – for example, data on physical energy flows gained by sensoring technology or shipping data garnered from the use of satellite imagery. They are also more keenly aware of using their own in-house data – for example, retail data from smart meters – to better effect. For this, many firms have built relationships with consultancies or software firms offering analytics platforms.

An industry has grown up around energy and commodity data and analytics, as well as robotic processing automation

In a recent Energy Risk survey on the use of commodities technology by energy firms (which was sent out at the same time as the Software Rankings and will be published in full next month), more than half of the respondents said they believed that in the future they would need to manage an increasing number of relationships with software firms. Some 40% of respondents refuted this, however, believing that large commodity trading and risk management (CTRM) software firms would buy up many of these smaller firms over time, becoming closer to one-stop-shops once again.

This year’s Energy Risk software survey has been expanded to reflect some of the new technological offerings now available to energy and commodity trading firms beyond the core CTRM space. It contains an entirely new section on enterprise risk software, as well as new categories on data, analytics and project development.

While the CTRM section reflects the dominance of the large, traditional vendors such as Ion Commodities, Pioneer Solutions and Allegro Development, the enterprise risk section shows the popularity of more specialised firms such as CubeLogic and Lacima Analytics. Several data providers appeared for the first time, for example Kpler and Veson Nautical for shipping data, while Genscape topped the list for data gathered through thermal and sensoring techniques. ZE PowerGroup dominated the data management section, while there were wins for KWA Analytics, Lacima Analytics, Machina Automation and capSpire in the technology advisory category.

Methodology

The survey went live on January 14, 2019 and closed on February 15. It received 261 valid votes. 

To compile the Software Rankings, respondents were asked to vote for their preferred software vendor, data management firm, data provider and technology adviser in a variety of categories. All votes were carefully checked and invalid votes stripped out. Examples of votes considered invalid are people voting for their own firm or using a free internet-based email address, multiple votes from the same person or IP address, and voters who choose the same firm indiscriminately throughout the survey.

Following closure of the poll, the results are subject to an internal review process, which can result in categories being dropped if they do not have enough votes. The outcome of the review is final.