Master the Knowledge to

Manage Energy Risk

The Value of ERP Certification

Global Association of Risk Professionals

January 2014

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Introductions and Agenda

Chris Donohue, PhD Managing Director, Research

and Educational Programs

GARP

Ben Baglin, ERP Head of Market Risk

EDF Trading NA

Shaun Connell, ERP Head Trader, Eastern Energy

TransAlta Corporation

Michael Sell SVP, ERP Program Manager

GARP

Need photo

Andrew Tudor, ERP Energy Resource Planning

NMPP Energy

• GARP and its role in Risk Management

• Energy Risk Management and the ERP Certification

• Perspectives on the role of the ERP in individual careers

• Everything you wanted to know about the ERP…but were afraid to ask

• Questions & Answers

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GARP’s Risk Management Certification Programs

• Energy Risk Professional (ERP®) program

• Launched in 2009 to address the growing importance of energy

• Program objective — assess an individual’s ability to measure and manage

physical and financial risk in the energy industry

• Financial Risk Manager (FRM®) program

• Leading global professional designation program for risk management

• Administered by GARP since 1997

• Program objective — assess an individual’s ability to measure and manage

risk in a real-world environment

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Fundamental Forces are Driving Demand for

Energy Risk Managers

• Energy companies are increasingly globalized and interconnected

• Technological innovation is driving growth in reserve development

• Relationship between physical and financial markets is evermore complex

• Transactions are happening faster and market data sets are getting larger

• Regulatory initiatives and requirements are increasing

• Growing awareness and implementation of ERM initiatives

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The ERP® Certification Prepares You for a

Career in Energy Risk

• A unique professional designation that is gaining industry recognition

• A practitioner driven exam curriculum guided by an oversight committee comprised

of CROs, commodity traders, risk managers and consultants from energy sector

• The ERP Exam is designed to assess an individual’s ability to measure and manage

physical and financial risk in the energy industry.

• Continuous learning opportunities through GARP’s CPE Program

• Positive signaling to colleagues and employers that will differentiate you

• Access to a global network of like minded energy market and risk professionals

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Validity and Reliability

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Practitioners Inform Exam Curriculum and Development

• The ERP is overseen by an Energy Oversight Committee (EOC)

• EOC is comprised of high-level practitioners with expertise across a range of risk

management topics that impact the global energy markets.

• Regular job task analyses and curriculum surveys are performed to identify

current industry demands and specific exam topics.

• The ERP curriculum is reviewed and revised annually in conjunction with the EOC

• The ERP curriculum is described in the 2014 Study Guide and AIMs documents

• The AIMs summarize the knowledge points contained in each required reading

• ERP item writers and other Subject Matter Experts (SMEs) rely on the AIMs to develop

examination items (questions)

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2014 Energy Oversight Committee

Ken Abbott Morgan Stanley & Company

Richard Apostolik GARP

Dr. Lawrence Austen Trafigura

Gordon E. Goodman* Alliance Risk Group

Jeff Jewell DTE Energy

Glenn Labhart (EOC Chairman) Labhart Risk Advisors

Alessandro Mauro Litasco SA

Mark D. May Philips 66

Shawnie McBride Direct Energy

Ken Robinson Calpine

Michael Sell GARP

Jonathan C. Stein Hess Corporation

Dr. Chris Strickland Lacima Group

Dr. Glen Swindle Scoville Risk Partners

John Wengler Hess Corporation

* Retired Occidental Petroleum

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The ERP Exams Are Designed to Be Fair but Rigorous

• Psychometric testing is completed on each exam

• Positive results indicate the ERP reliably measures competence in energy risk skills

Historical Pass Rates

Nov

2009

May

2010

Nov

2010

May

2011

Nov

2011

May

2012

Nov

2012

May

2013

Nov

2013

61% 62% 49% 54% 51% 50% 45% 45% 47%

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Market Acceptance of the ERP

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* November 2009 only

Candidate Registrations Are Growing

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Awareness is Global

USA 36%

Canada 8% UK 11%

Singapore 6%

India 7%

Switzerland 7%

Germany 5%

Countries with the Highest Percentage of ERPs

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ERP Highlights

• Over 700 Certified ERPs globally

• More than 60 organizations with two or more ERPs

• ERPs come from more than 50 countries

• Organizations with the most ERPs

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Insights from ERPs

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Ben Baglin, ERP, Head of Market Risk, EDF Trading North America

Ben has 16 years of experience in trading and risk management in

the global oil market, and the European and US Gas and Power

markets respectively. He has held trading, portfolio management and

risk manager roles at Shell Trading, Graham Capital Management,

Merrill Lynch and EDF Trading in the US and Europe.

• Describe the types of activities you are typically involved with in your role at EDF Trading.

• What are some of the most important trends in energy markets and the role of risk management?

• What differentiates energy market risk from traditional financial market risk?

• What do you consider to be the underlying value in becoming a Certified ERP?

Market Risk Management: Ben Baglin

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Power Trading: Shaun Connell

Shaun Connell, ERP, Head Trader of Eastern Energy, TransAlta

Shaun has more than 10-years of power trading experience at

TransAlta. As Head Trader of Eastern Energy, he is responsible for

achieving gross margin targets for ―Eastern Trading Operations‖ through

asset optimization, origination, and proprietary trading in physical and

financial energy markets. Shaun has recently taken the business lead on

development and implementation of an Energy Trading Risk

Management (ETRM) platform that will replace current business

processes and legacy systems.

• What knowledge and skills have been most instrumental in your career success?

• How did you hear about the ERP?

• A number of your colleagues at TransAlta have taken the ERP – what feedback have you received?

• Describe the benefits you envision from the integration of the ERP into TransAlta’s risk culture?

• What advice would you give ERP candidates who are interested in pursuing a career in energy trading?

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Quantitative Modeling and ERM: Andrew Tudor

Andrew Tudor, ERP, Energy Resource Planning, NMPP Energy

Andrew recently joined the Municipal Energy Agency of Nebraska

(MEAN) as energy resource planner. Prior to joining MEAN, Andrew

held a variety of risk roles at the Tennessee Valley Authority (TVA)

where he was engaged in enterprise risk, operational risk, quantitative

risk modeling, commodity forecasting, and long-term enterprise

planning. Before transitioning to the energy markets, Andrew was a

statistician at the United States Census Bureau.

• What knowledge and skills did you find the most useful in your transition to energy risk?

• Describe the risk management tools and modeling projects you have helped implement.

• What have you found most appealing about working in the energy markets?

• How has the ERP Certification added value to you personally and in your career progression?

• What advice would you give ERP candidates considering a transition to energy risk management?

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2014 ERP Program Offering

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The Path to Becoming a Certified ERP

Certified

Energy Risk

Professional

(ERP®)

Mandatory

Continuing

Education

Pass ERP Exam

Demonstrate Two

Years Relevant

Work Experience

• Pass the ERP Exam

• 140 question multiple-choice exam

• Two 4 hour sessions with a break for lunch

• Fulfill required work experience

• Can be completed prior to or after sitting for the exam

• Candidates have 5 years to fulfill requirement after passing exam

• Participate in Continuing Professional Education (CPE)

• 40 credit hours earned over 2 years

• GARP provides monthly listing of CPE opportunities

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• Physical Commodities

• Oil, Gas, and Coal markets (25%)

• Electricity Markets and Renewable Generation (25%)

• Financial Markets and Risk Management

• Financially Traded Energy Products and Structured Transactions (15%)

• Energy Commodity Price Formation and Market Risk (15%)

• Credit, Counterparty, and Country Risk Assessment (15%)

• Enterprise Risk Management and Business Ethics (5%)

Exam Curriculum Covers the Entire Energy Value Chain

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• www.garp.org/erp/study-center/study-materials.aspx

• Study Guide (Free)

• AIMS (Free)

• Exam Preparation Handbook (Free)

• ERP Core Readings Course Pack (US$295 + shipping)

• www.garp.org/erp/study-center/free-practice-exams.aspx

• Practice Exams (Free)

• www.garp.org/erp/study-center/exam-preparation-providers.aspx

• Register with a GARP approved ERP Exam Preparation Provider

Download Resources for Exam Preparation

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• Earning the ERP is just one step in building your energy risk career; maintaining

your knowledge and skills is equally important.

• Certified ERPs are required to earn 40 hours of CPE credit every 2 years

• GARP helps ERPs stay abreast of current industry trends and risk management

knowledge through our Continuing Professional Education (CPE) Program.

• The CPE program is global, flexible and delivers an extensive range of highly

relevant programs from webcasts and training programs to live conferences and

seminars.

• GARP has partnered with a broad range of global providers of education and

training to bring you the most up-to-date information and share best practices in

risk management

• In addition to structured activities, GARP shares an extensive list of articles,

journals, whitepapers and other published materials on a monthly basis

Mandatory Continuing Education for ERPs

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ERP Program Registration Timeline and Fees

ERP Program Enrollment and Exam Registration Fee

May 17, 2014 Nov 15, 2014

Enrollment Fee – US$300 Valid for 4 years

Early Registration – US$450 Dec 1, 2013 - Jan 31, 2014 Jun 1, 2014 - July 31, 2014

Standard Registration – US$575 Feb 1, 2014 - Feb 28, 2014 Aug 1, 2014 - Aug 31, 2014

Late Registration – US$750 Mar 1, 2014 - Apr 15, 2014 Sep 1, 2014 - Oct 15, 2014

• Enrollment fee includes 1-year complimentary GARP Individual Membership

• Register for the May 2014 exam at www.garp.org/erp/register/register.aspx

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2014 ERP Exam Sites

Africa Jordan, Amman USA, Colorado, Denver Ireland, Dublin

Ghana, Accra Korea, Seoul USA, D.C., Washington Italy, Milan

Kenya, Nairobi Kuwait, Safat USA, Florida, Tampa Luxembourg

Nigeria, Lagos Lebanon, Beirut USA, Georgia, Atlanta Poland, Warsaw

South Africa, Cape Town Malaysia, Kuala Lumpur USA, Illinois, Chicago Russian Federation, Moscow

South Africa, Vanderbijlpark Oman, Muscat USA, Louisiana, New Orleans Spain, Barcelona

Pakistan, Karachi USA, Massachusetts, Waltham Spain, Madrid

Asia Philippines, Manila USA, Michigan, Ann Arbor Sweden, Stockholm

Bahrain, Manama Saudi Arabia, Riyadh USA, New York, New York Switzerland, Geneva

China, Beijing Singapore USA, NJ, New Brunswick Switzerland, Zurich

China, Chengdu Taiwan, Taipei USA, North Carolina, Charlotte The Netherlands, Amsterdam

China, Guangzhou Thailand, Bangkok USA, Ohio, Columbus Turkey, Istanbul

China, Hong Kong United Arab Emirates, Dubai USA, PA, Philadelphia Ukraine, Kiev

China, Nanjing USA, Texas, Dallas UK, England, London

China, Shanghai Americas USA, Texas, Houston UK, Scotland, Edinburgh

China, Wuhan Bermuda, Paget USA, Washington, Seattle

India, Bangalore Brazil, Sao Paulo Oceania

India, Chennai Canada, Alberta, Calgary Europe Australia, Melbourne

India, Hyderabad Canada, BC, Surrey Austria, Vienna Australia, Sydney

India, Kolkata Canada, Ontario, Toronto Belgium, Brussels New Zealand, Auckland

India, Mumbai Canada, Quebec, Montreal Bulgaria, Sofia

India, New Delhi Jamaica, Kingston Czech Republic, Prague

Indonesia, Jakarta Mexico, Mexico City France, Paris

Israel, Tel Aviv (Sunday) USA, California, Los Angeles Germany, Frankfurt

Japan, Tokyo USA, California, San Francisco Germany, Munich

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Questions & Answers

• ERP Facebook chat January 29, 2014, 11AM EST

• Opportunity for additional Q&A before early registration ends

• Learn more about the ERP Program, including Exam preparation resources at:

www.garp.org/erp Email: memberservices@garp.com

• Connect with other Certified ERPs and ERP Exam candidates at:

www.facebook.com/garperp

www.linkedin.com – “Energy Risk Professional group”

• Follow GARP on Twitter:

@GARP_Risk

Use the “Ask a Question” feature to submit webinar questions

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Contact Us Directly Anytime

• Chris Donohue: chris.donohue@garp.com

• Michael Sell: michael.sell@garp.com

Creating a culture of

risk awareness®

Global Association of

Risk Professionals

111 Town Square Place

14th Floor

Jersey City, New Jersey 07310

USA

+ 1 201.719.7210

2nd Floor

Bengal Wing

9A Devonshire Square

London, EC2M 4YN

UK

+ 44 (0) 20 7397 9630

www.garp.org

© 2014 Global Association of Risk Professionals. All rights reserved.

About GARP | The Global Association of Risk Professionals (GARP) is a not-for-profit global membership organization dedicated to preparing professionals and

organizations to make better informed risk decisions. Membership represents over 150,000 risk management practitioners and researchers from banks, investment

management firms, government agencies, academic institutions, and corporations from more than 195 countries and territories. GARP administers the Financial Risk

Manager (FRM®) and the Energy Risk Professional (ERP®) Exams; certifications recognized by risk professionals worldwide. GARP also helps advance the role of risk

management via comprehensive professional education and training for professionals of all levels. www.garp.org.