Evaluating credit & market exposure

Today’s volatile energy prices and the lower creditworthiness of some energy intensive users means energy providers have to assess counterparty risk thoroughly. David Coffman of GDF SUEZ Energy Resources provides some tips for assessing risk in the non-residential retail energy sector

Many non-residential retail energy consumers need protection from volatile energy prices but are struggling to remain creditworthy. Today’s combination of increased energy volatility, increased counterparty credit risk and constrained capital, requires retail energy providers (REPs) to determine judiciously when and how some retail energy consumers become too risky to accept as customers. The purpose of this article is to identify and integrate key criteria in evaluating the creditworthiness of