Making the electricity markets understandable and work for your business is currently a tall order. Cielo Energy, headed up by managing director Stuart Lloyd-Evans, aims to do just that. Tim McManan-Smith reports
Cielo Energy (pronounced See-el-oh from the Spanish word for sky) is a management consultancy that provides independent expertise and advice to maximise opportunities and navigate the complexities of the electricity markets.
Lloyd-Evans has spent over 25 years working across generation, trading and supply of energy, says that Cielo’s services cover multiple players throughout the power market. “Relevant to any business that has exposure to the electricity market, Cielo’s aim is to let customers focus on running their businesses rather than worrying about the energy market.
“The key is asking the client, ‘What do you want?’ We then make all our expertise available so that they turn up as an informed buyer or seller.”
The risks of ‘getting it wrong’ in trying to time the market when there is such volatility is much larger now than they have been historically, simply because the market price moves more quickly and has tended to be upward trending recently. This means understanding what you’re trying to achieve and being clear on what exposure you can and cannot tolerate has never been more important. trading / hedging strategies that were fine in the past may not hold in the future.
Lloyd-Evans says that current events are unique in the history of deregulation, and without a clearly defined market strategy it is easy to feel powerless. He emphasises that every organisation requires a tailor-made approach to the power market to get the best result to their business particular circumstances, saying “There is no single ‘right’ answer as each business is different.”
With this in mind, Cielo has developed a bespoke, cost effective review the 40 Day: Power, Profit, & Performance Programme. “In simple terms is about developing a coherent, business focussed strategy to energy instead of allowing the markets taking control of you,” says Lloyd-Evans, “what are you trying to achieve from energy? And given all this, this is what we think you should be doing.”
Lloyd-Evans stresses that Cielo is not a broker, and offers advice built around delivering a bespoke approach that works with your wider business. Imagine there was no energy market, and your business just needed to either sell (or buy) to satisfy its energy needs. What would you want? Over what period? Why?
The Programme then moves on to how are you currently approaching the energy market, before looking at how to reach your destination and implement the strategy.
Cielo Energy offers a wide range of energy market services, some of which are detailed below.
Strategic advice
Electricity markets are changing, with a more diverse generation mix and more demand for side participation. This shift impacts all electricity users, changing the overall risk profile of the sector. Our advice can help establish your options and trade-offs in this emerging new market.
Market advice
Let us help you see the wood for the trees. Electricity markets are complicated, and there is a huge amount of data, which can lead to even more confusion. We can provide market insight and advice to offer your business a clear view of what it should focus on to achieve its objectives.
Deal structuring
Major electricity transactions are complicated. There are many risk transfer and commercial options to choose from. Work with us to establish how you can structure transactions to deliver maximum value, with an acceptable risk profile.
Portfolio optimisation
Have a number of products or assets? Having a balanced portfolio approach to your risk management is a must have. Work with us to provide an end-to-end hedging and optimisation approach to managing your positions and risks.
Risk management
How should your business fix its energy price exposure? What level of risks can it tolerate? What risk policies do you need? We can support the development of a business wide energy risk management framework.
Transaction advisory
Whether you are buying or selling, M&A takes a large amount of resource. We apply our expertise in understanding the electricity market risks involved, and whether you are buying or selling, we can support you to get a better return.
