The Chief Product Officer of Brady PLC, Libby joined the company in October 2017 and is now responsible for leading day-to-day strategizing, services delivery and execution for all product and software development-related activities, including the research and identification of long-term market needs that Brady must address in order to generate the highest value and return in the markets. Brady entered the energy space in late 2010, which was a natural progression for the firm as the Company estimated that more than 60 percent of its customers were actively trading energy. The company has since established itself as the market leader in this landscape. One prime reason for this success is the Company’s relentless pursuit toward comprehending its clients’ needs and evolving its products accordingly. An expanding need to manage short-term volatility and exposure, driven by continued investments in non-dispatchable renewable power production has been one of the major trends impacting the ETRM area recently. Aleksander Sasha Cvetkovic, the Head of Logistics and Settlement at Brady PLC says, “Recently we have witnessed a significant expansion of renewable electricity generation in Europe—generation that may change intermittently, depending on the time and changing weather conditions.” Further, Libby mentions, “Energy companies have a need to facilitate flexible assets on new marketplaces.” Brady works closely with its customers in their effort to adapt to the changing needs that these trends cause. “We’ve modularized our portfolio, streamlined our delivery processes and can leverage cross-commodity synergies to achieve scalable and cost-effective offerings that addresses the needs of customers,” Libby mentions. “One example of this is how we are extending Brady’s integration framework to simplify the connection and reconciliation of deal data between ETRM and position management systems. This allows customers to build short-term trading solutions, which can operate efficiently and with high availability, even when they are disconnected from upstream systems,” states Libby.
Further, low and yet highly volatile energy prices have caused Companies to continue increasing their focus on managing operational risks and efficiency through automation. Brady, for its part, reacts to this market requirement by placing particular emphasis on the ongoing expansion of its automation capabilities. The firm’s ETRM reporting repository is updated automatically so that it can continuously provide updated portfolio, position, and transaction reporting. Libby adds, “other examples of Brady’s automation capabilities include our Automated Deal Capturing and Deal Reconciliations capabilities which offer customers FIX adapters with open access to the industry standard Financial Information eXchange protocol.”
Brady offers its software solutions as flexible modules, which can act as either standalone point solutions or can be combined together into a broader and comprehensive product offering.
We’ve modularized our portfolio, streamlined our delivery processes and can leverage cross-commodity synergies to achieve a scalable and cost-effective offering
This ensures customers can tailor the system capabilities that they want without investing in tools they may never use. On the top of their agenda is security; Brady makes sure its solutions are compliant with new and evolving regulatory directives such as GDPR and MiFID II. They provide additional record-keeping and reporting facilities for maintaining order books and improving liquidity and a convergence of traded products and prices.
Assisting Vertically Integrated Energy Trading
Brady’s ETRM solution provides a central trade repository covering both, plain vanilla and sophisticated instrument classes. The internal Curve Server function includes live market price adapters for vendors in real time and smooth arbitrage free-forward curves with a profiling granularity all the way down to 15 minutes resolution. Control over the positions is obtained with portfolio reporting, P/L reports, and risk management engines, which allow the user to run standard risk measures such as Exposure, Currency Exposure, Parametric VaR, Monte Carlo VaR, CFaR, and PaR.
On the asset management side, Brady provides contract management functionalities, enabling users to aggregate measurements from SCADA and calculate the settlement from complex tolling agreements and modules, which simplify the dispatching of power plants by grid operators. On the trading side, the time-series forecast and realized volumes are managed in the Physical Energy Data Management module. This specialized system allows powerful formula-based time-series management on large data volumes in an efficient and reliable manner. The module also manages the sub-balance groups, generation portfolios, and the aggregation and settlement of portfolios.
Brady’s logistics solution plugs into both physical portfolio management and the ETRM systems allowing real-time position monitoring, trading support, and communications to short-term marketplaces and grid operators. Libby adds, “In addition, counterparty risk is handled in a dedicated Credit Risk module that receives exposures per counterparty from the ETRM, including downloaded credit ratings from rating firms so users can assess and report the credit default probabilities, expected shortfall, and potential future exposure.” The firm also covers end-user sales by offering a solution for quick price offer calculations linked to live market prices from the Curve Server.
Evolving with the ETRM Market
Over the years, Brady has delivered best-in-breed solutions for the ETRM space and is poised to march ahead in the same fashion when it comes to responding to its clients’ needs. Libby mentions, “Recently, CIOs are facing an increasingly large volume of market changes that require customers to change, improve, and modify their operational trading processes. As such, Brady has taken an active approach to supporting customers in making these transitions by ensuring we address new market change processes as part of our standard product offering.”
As part of its developments for the I-SEM market, the firm updated its exchange integrations to the latest versions of the exchange APIs.
Another challenge for CIOs, according to Libby has been an increased focus on IT security and compliance, especially after recent malware spreads and new privacy regulation updates. To that end, Brady provides standard tools and services to help its customers to identify and manage personal information and GDPR compliance. The company also leverages the latest middleware, operating systems, and libraries in its software development and standard maintenance work to minimize the risk of exposure. “This makes it easy for Brady’s customers who have on-premise solutions to achieve compliance with their infrastructure,” informs Libby.
Brady has also assembled a team of machine learning and big data experts to support its customers in managing large data sets in cloud-based processing environments. “We can now offer customers both the technical competence and organizational and procedural advice about how to make the most out of their data. This team also allows us to fast-track our plans for the delivery of new, modular predictive analysis and forecasting capabilities,” states Libby.
Further, to deliver on the integration and interoperability needs of CIOs, Brady considers iPaaS readiness and standard integration APIs as priorities while developing new interfaces, integrations, and software services. Brady’s development teams leverage a standard framework and toolkit which allows them to integrate data stores cost effectively.
Toward a Customer-Centric Future
Cvetkovic informs, “Renewable energy sources increase the need for short-term intraday trading, and therefore a method of efficiently calculating and presenting energy balances is key. It is also beneficial to reduce the number of different systems involved, thereby decreasing complexity and operation risk. Therefore, in order to cope with increased cross-border trading the software industry will need to implement new, particularly innovative, integrated, out-of-the-box solutions that support trading across multiple borders in multiple standards, and offer a common workflow process across different market structures and present the required information to the operator near-to-real-time.
Witnessing the opportunities that exist in the markets outside Europe, Brady’s goal is aligned in one direction: “world domination.” The company is expanding its market reach in the current markets and aims to make its presence resonate in Asia, the U.S., and Eastern Europe.
Through significant investments allocated for modernizing its technology stack, Brady is updating its UI, adding new systems and modules, enhancing integration capabilities and moving to a more modular component-based design approach that will allow the firm to tailor its offering according to the needs of its users. “Being customer focused, we strive to create long and lasting trusted customer relationships. We have always been a vendor, who is easy to talk to, where it is simple to get hold of market insights in an informal manner and where long-term customer relationships count more than the next license deal,” informs Libby, pointing toward a customer-centric future.