IN-PERSON CLASSROOM SEMINARS

• Correlation & regression analysis; real option analysis; the Black-Scholes option pricing model; binomial trees; GARCH Models; the measurement of energy price risk; and how to use correlation and regression analysis for maintaining a competitive edge.
• Workshop exercises will have you building forecast models including time series and financial engineering price models including Geometric Brownian Motion and Mean Reversion Jump Diffusion.
• How to minimize price risk through operational design flexibility; measure forward price volatility and adapt Value-at-Risk concepts (VaR) for the Energy Industry.
• Workshop exercises will have you building VaR models, calculating volatility and simulating complex energy projects.
• Use actual case studies to examine 1) how Monte Carlo simulation is used to value renewable energy, demand response programs and energy storage projects; 2) bench-marking techniques used for estimating the incremental cost savings of expanding existing operations; and 3) real-option value of generation assets and power purchase agreements.
• Actual workshop problems and case studies will look at statistical applications and tools most frequently used in the energy industry.
• Learn the four manage statistical metrics.

DAY ONE:

The Basics of Deterministic vs. Probabilistic Thinking for Energy Applications

• Basics of data science - Information from Data
• Descriptive Statistics, Means, Standard Deviations, Distribution Shapes
• Frequency Distributions and Confidence Intervals
• Implications of the Empirical Rule, Transformations and Probability

Fundamental Modeling Tools and Simulation

Exercise: Setting up a Monte Carlo Simulation to Evaluate Project Value and Risk

 

Application: Calculating Value at Risk (VaR)

• The Linear Method and
• The Quadratic Method
• Historic Simulation Method
• Monte Carlo Method

Exercise: Calculating VaR Using Three Different Methods

 

Application: Hedging Energy Exposure

• • Understanding the "Greeks
  • How and when to Hedge
  • Delta Hedging
  • Dynamic Hedging
  • Gamma Hedging

 

Application: Component Risk Analysis

• Payoff Diagrams
• Portfolio VaR Diagram
• CAPM, RAROC and the Sharp Ratio
• Calculating Load Following Supply Risk
• Layered Hedging using Statistical Triggers

 

Exercise: Customer Migration Model Estimating Migration out of Standard Offer Service

Exercise: Measuring Load Following Supply Risk

Exercise: Measuring Intermittent Renewable Supply Risk

 

Correlation and Regression Analysis for Maintaining the Competitive Edge

• Univariate and Multivariate Analysis
• Hypotheses Testing
• Testing for Equal Means and Variances
• Control Charts

 

DAY TWO:

The Energy Forecasting Toolbox

• Historical Trend Analysis
• Univariate Time Series
• Multivariate Time Series
• Econometric Models
• Bayesian Estimation
• End-Use Models
• Engineering or Process Models
• Optimization
• Network Models
• Simulation
• Game Theory
• Scenarios
• Surveys

Case Study: Statistical Reports that Everyone Can Understand

Case Study: Benchmarking to Industry Standards- GTS Steel vs. KCPL

Exercise: Building Regressions and Forecasting, PDF's, CDF's and Payoff Diagrams

Exercise: Calculating Hedge Ratios, Constructing an Energy Hedge and a Weather Hedge

Exercise: Using Forecasts in Monte Carlo Simulation to Calculate Risk Premium

 

DAY Three:

Introduction to Real Options Analysis

• • • Details of Option Model Implementation
    • Real Options and Net Present Value (NPV) Analysis
    • Estimating Volatility and Uncertainty In Historical Prices
    • Black-Scholes, Binomial Trees, and GARCH Models
    • Geometric Brownian Motion and Mean Reversion

Application: Minimizing Price Risk through Operational Design Flexibility

Application: Real Option Value of Demand Response and the Smart Grid

Exercise: Calculating Volatility

Exercise: Simulating Prices using GBM and Mean Reversion Monte Carlo Models  

Exercise: Valuing Combustion Turbines using Real Options

Exercise: Valuing Gas Storage using Real Options

 

Kenneth Skinner, Ph. D. -- Vice President Integral Analytics Inc.
Dr. Skinner is a Vice President for Integral Analytics Inc. (IA), an energy conservation focused analytical planning software and consulting firm. IA is fully owned by Willdan, an industry-leading energy solutions provider and sustainability consultant. Dr. Skinner supports core energy risk management and sustainability services including electric grid optimization, integrated resource planning, design and implementation of integrated demand side projects and distributed energy resources. He is part of a team specializing in energy engineering, renewable generation, electric vehicle fleets and infrastructure, program management, microgrids, financing, data analysis, software development, and other fields. Dr. Skinner has over 20 years of energy industry experience developing energy conservation and commodity supply strategies involving portfolio risk management, hedging strategies, and least-cost supply opportunities. Having worked as an energy consultant, Dr. Skinner has significant experience in economic analysis and modeling of distributed energy projects, forward energy prices, financial derivatives, and valuation of energy assets using econometric analysis, statistical methods, optimization principles, real option valuation techniques. Dr. Skinner is widely published having served as the technology columnist for Wiley Natural Gas and Electricity Journal. He is a noted speaker on energy related topics for organizations such as AESP, IAEE, ACEEE, PLMA, IEPEC, INFORMS, Infocast, EUCI, SNL Energy and PGS Energy Training.

This seminar will be held at the hotel listed below or can be conducted on-site at your facilities. The seminar will start promptly at 8:00 AM and will finish at 4:30 PM on the first and second day. On the third day, the seminar will resume at 8:00 AM and will finish at 12:00 PM. The program includes continental breakfast, lunch on the first and second day, and breakfast on the third day. Attendees also receive a professionally produced seminar manual that can serve as a valuable office reference. Dress is business casual for all seminars.

COVID 19 Information: Please click here for the PGS Covid-19 policy. You can confirm each hotel's specific COVID 19 policy using the link(s) provided below.

The price for this comprehensive three-day seminar is $2,945 (USD).

Payment is due prior to the start of the seminar by Visa, Master Card, American Express, or corporate check. Seminar fees will be charged to your credit card at the time of registration unless other arrangements have been made. Please make checks payable to "PGS Energy Training" 26 Teal Lane • Hilton Head Island, SC 29926. Cancellations will result in a credit that is good for 2 years which can be transferred to a colleague. Substitutions may be made at any time. For more information on PGS policies regarding administrative matters and complaint resolution, please contact our offices at (440) 853-1038.

This live group seminar is eligible for 18.0 CPE credits. Be aware that state boards of accountancy have final authority on the acceptance of individual courses for CPE credit. As of January 1, 2002, sponsored learning activities are measured by program length, with one 50-minute period equal to one CPE credit. One-half CPE credit increments (equal to 25 minutes) are permitted after the first credit has been earned in a given learning activity. You may want to verify that the state board from which your participants will be receiving credit accept one-half credits.