Facilitating The Energy Transition: Brady’s Approach – Interview with Chris Regan Managing Director of Brady Technologies
Recently, I had a chance to discuss market changes related to the energy transition with Chris Regan, the Managing Director of Brady. I asked him few questions, some were about the market and the current stage of the transition to Net Zero, others about Brady’s software solutions supporting this transition.
ComTech Advisory The energy transition has introduced new players to the market, such as Independent Power Producers (IPPs), project developers, and aggregators, while also driving significant changes within established companies. What is your perspective on these changes? Do you see potential new customers emerging, and what are they seeking? Additionally, what changes have you observed among your existing customers?
Chris Regan: Chris outlined three types of newcomers in the renewable energy trading markets. The first group comprises large oil and gas majors like Shell and BP, which are aiming to become significant players in renewables trading. These companies are developing renewable assets and managing extensive Power Purchase Agreement (PPA) portfolios.
The second group includes utilities, which tend to be slower moving but often serve as a route to the market for asset developers or Independent Power Producers (IPPs). IPPs with smaller portfolios typically work through a utility, but as their capacity grows—up to 1000 MW, for instance—they seek to maximize their revenue and opt for self-trading.
The third group consists of aggregators who initially enter the ancillary services market, where the barriers to entry are lower than in wholesale markets. As their businesses expand, many aggregators start providing general trading services, often outperforming utilities in this area.
ComTech Advisory Brady offers an eco-system of software tools for energy businesses. They cover processes from ETRM to scheduling & nominations, including also intraday, automated and algo trading. Where do you see the biggest interest from customer side and why? Is there any recent trend?
Chris Regan: The starting point for most is usually the scheduling tool. For instance, small trading desks, typically dealing with financial instruments like Contracts for Difference (CfDs), also trade physical deals in the short-term physical market, which requires scheduling capabilities. IPPs and project developers (PDs) also seek scheduling solutions, as well as oil and gas majors, even those these major market players may already have some scheduling tools in place.
The next area of interest is PowerDesk with its short-term trading dashboard that integrates also energy data management.
Energy data management is becoming critically important for companies managing thousands of meter points or forecasts, Chris explained. Many businesses attempt to handle these large time-series datasets within their ETRM systems, but ETRMs are not designed for such extensive data management. As a result, all customer segments—from IPPs and asset developers to utilities and oil majors—are showing interest in this solution.
ComTech Advisory But what about algo trading? Usually, traders want to build own algorithms. What is the Brady’s strategy here?
Chris Regan: Chris agreed that traders prefer own proprietary algorithms and asserted that exactly this assumption is behind the Edge solutions offered by Brady. Generally speaking, he saw a few possible approaches to this issue:
- High speed type services providing certain reaction of the order to market moves
- Algo service offering, where vendors offer to tweak the algorithm for the customers to get a proprietary algo.
- Brady follows a different strategy based on the idea to give customers a toolkit which allows them to create proprietary algorithms easier and retain IP.
Chris emphasized the importance of providing data scientists with tools that allow them to quickly develop algorithms without having to write the entire code from scratch. The PowerDesk Edge product offers libraries and Python subclasses that can be used to create proprietary algorithms.
To illustrate this approach, he shared examples, including the Momentum strategy. This is a top-level strategy based on machine learning (ML) techniques. The ML algorithm analyzes all trades for a specific instrument to identify significant trends. If certain trends appear to be consistent at specific times of day with a high level of confidence, the algorithm might suggest, for instance, waiting before selling if you want to sell or buying immediately if you’re looking to purchase.
ComTech Advisory Battery management and optimization are becoming increasingly important, with European markets expecting a significant influx of new Battery Energy Storage System (BESS) projects in the coming years. What is your approach to managing battery assets? Do you currently offer battery analytics, or do you have plans to introduce this capability?
Chris Regan: Based on his experience with battery management Chris expressed the view that most battery owners or operators have their own optimization algorithms which they believe in. The role of trading software like PowerDesk Edge is to integrate with optimization systems and use the resulting positions for trading. Edge provides market data to third-party optimizers and retrieves the battery schedule in return. According to Chris, the standard software should not include any proprietary functions but should focus on supporting generic market-related functionality while offering a toolkit for building custom solutions. However, if a customer would request it, Brady’s own optimizer could be created. From standpoint of requirements on the optimizer Chris emphasized that even though a co-located battery and a standalone battery need different type of optimization the common requirement of low latency is important. According to Chris’s experience the battery optimization must be able to run at least 5 times in a half hour to deliver current position for an intraday trader.
ComTech Advisory The same question applies to Virtual Power Plants (VPPs). The VPP value chain involves several steps: aggregating distributed resources, deriving flexibility, optimizing strategies to sell that flexibility to the markets, supporting trading, facilitating market communication, redistributing trading results among participating assets, and settling positions. Which of these steps does Brady’s ecosystem of tools support?
Chris Regan: According to Chris, PowerDesk largely supports data management and aggregation but does not facilitate the creation of consumption-oriented VPPs. Developing such solutions requires specific knowledge of consumer-side assets. For example, building a VPP based on EV batteries would require industry-specific expertise to identify and aggregate available flexibility. However, PowerDesk does support the aggregation of meter data from various distributed assets both in-front-of-the-meter and behind-the-meter, as well as the trading of VPP positions that have been aggregated and optimized by third-party systems. PowerDesk is there to take the VPP trading position to market, getting the best price for the customers and minimizing the costs of non-delivery.
ComTech Advisory There are several new rules and regulations in the UK market, such as the introduction of rules allowing Virtual Lead Parties (VLPs) and Active Market Virtual Lead Parties (AMVLPs) to participate in the wholesale market, EPEX’s plans to launch a platform for trading ancillary services in the UK, and the creation of the National Energy System Operator (NESO). Which of these changes impact your solutions, and how do they influence your approach?
Chris Regan: The entry of VLPs and AMVLPs into the wholesale market is likely to attract more companies, increasing the pool of potential customers. However, Chris noted that smaller units may not be able to participate directly, and the economy of scale is needed for the wholesale market participation. Smaller prosumers are more likely to rely on aggregators, who in turn would require software solutions, like those offered by Brady, to fully realize the market potential of their portfolios.
Concerning the creation of the National Energy System Operator (NESO), Chris did not expect an immediate impact on the trading solutions, however in general, any regulatory or market change helps software vendors and customers come together to solve the new challenges being faced by new rules.
About Chris Regan, Managing Director of Brady Technologies
Chris leads the strategic direction of Brady’s PowerDesk suite of solutions for power trading markets, including Brady’s pioneering algorithmic trading software development initiative.
As an energy trader, Chris was present at two market openings before heading up EDF Energy’s Trading and Operations capabilities between 2009 and 2017. As Vice Chair of the Power Trading Committee and Chair of Energy UK’s Wholesale Markets subcommittee, Chris helped create the current GB energy market today, making changes to the energy trading products, negotiating the mandatory market making rules and making changes to allow customer’s assets to be re-optimised closer to real-time.
In 2017 Chris delivered a distributed trading capability (Powershift) into EDF, allowing customers to access markets alongside EDF’s own fleet of power stations and batteries. EDF’s Powershift is now a leading player in the UK flexibility market, optimising batteries, engines and DSR on behalf of EDF’s customers and is part of the international group’s flexibility offerings.
Chris has a background in Physics and complements this with an MBA from INSEAD.
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