I visited with Michael J. Snayd, VP of Business Development & Marketing at Aquilon Energy Services a few days ago to get an update on their activities. For those unfamiliar with Aquilon, they’ve recently launched a cloud solution for reconciling and settling wholesale energy transactions. Using their system, the Energy Settlements Network (ESN), companies can automate routine and sometimes tedious settlement tasks, reducing manual effort and freeing resources for higher value tasks, such as more quickly clearing any exceptions that may arise. For those using the system, surprises during end of month accounting close process are reduced or eliminated, in turn reducing the time and effort required for accounting close by as much as a day or more and accelerating cash flow.
According to Michael, the real-world impacts for companies using their system has been up to a 50% improvement in efficiency in the settlements process, and up to a 75% increase in collaboration to settle discrepancies with counter parties.
With more than 500 companies currently accessing the ESN, including industry heavyweights such as Macquarie, the company has found considerable success in the natural gas and power space, and will soon be launching in the oil, NGLs and products markets. Additionally, Michael indicates they’ve recently signed and will be onboarding a few of the world’s largest energy trading companies within the next couple of months.
Though settlements may not be one of the sexiest processes within the energy trading sphere, it is one of those processes that is absolutely necessary and has required a fairly high concentration of human effort – increasing administrative costs and impacting profitability. By leveraging the cloud to create a peer-to-peer network to reduce costs and improve trading margins, Aquilon’s ESN provides a clear value proposition and would be a step in the right direction for those companies that have been seeking ways to become more of a “digital business.”