I recently moderated a panel session at Commodity Trading Week in Houston where one of the panelists was Robert Balinski, vice president of services at Enuit. After that event, I sat down with him to get his impressions of the current ETRM/CTRM market.
When asked how he was seeing things, he remarked that the “market is certainly more exciting than it was last year. With the higher and more volatile energy prices, combined with the energy transition, we’re seeing a lot of increased interest in our products.”
That interest includes a recently signed deal in which Enuit’s Entrade system will be used by an operator that produces natural gas (methane) from an aerobic waste system powered by manure from feed lots. In addition to methane sales, the facility also generates green certificates which are then sold into the California markets to natural gas companies to offset their carbon emissions.
Other new deals that have recently been signed include a Houston-based company trading multiple commodities, including natural gas, metals and agriculturals; and an East Coast hedge fund trading financial commodities of all types.
In terms of new prospects, he noted that Enuit has seen a 300% increase in leads in just the last several weeks. In addition, they are being approached by several of the largest global energy companies who are exploring alternatives to their existing systems, all of whom share a vendor in common.
Robert noted they are seeing interest in almost all commodities, including power, renewables, oil & oil products, metals and ags, though perhaps surprisingly, he said they aren’t seeing a lot of activity in the natural gas markets despite persistent high prices and increased global demand driven in large part by the impacts of the war in Ukraine.
When I asked about any other trends he’s noticed lately, he noted that they are having to work harder to find qualified resources for consulting and service delivery. “We are seeing fewer experienced resources in the market and unfortunately, I think it’s a trend that will continue and possibly grow worse as younger people shy away from energy due to the perception that it is a “dirty” business. We’ve been fortunate to keep up with demand for quality people but it has been challenging.”
Finally, he also noted that with inflation increasing, the costs associated with software delivery are also rising.
Though he didn’t say so, it does seem that high levels of inflation, combined with the increasing competition for new resources, makes it likely that end users, regardless of the vendor suppling their system, are going to see higher prices not only for software fees, but perhaps more immediately, consulting services as well.