Testimonials | About Encore

"Creating the correct trade off between risk and reward is a challenge that faces all businesses and creating a strategy that remains consistent with that balance is even more difficult. We use a third party service provider to help us with this part of the process".

“Encore help us translate the risk limits we set into the consequential amount of the portfolio that needs to be fixed. As the market changes and our business evolves we can either adjust the proportion of the portfolio in a fixed price or we can change the amount of risk that we are prepared to take and adjust the risk limits accordingly.

More importantly, by using a risk limit to achieve the year on year price consistency instead of a fixed price, we don't forgo opportunity and we have the ability to participate in market falls should they occur."

“Whilst we were controlling our risk during the price rise’s the real power of the Value at Risk process only really became clear as prices fell back to where they started from. Our old approach would have seen us buy at the top of the market and be stuck with the position, but using the Value at Risk approach we were able to unfix prices as they fell in a controlled and systematic way which meant that we participated as prices fell. It wasn't long before our position was below what we would have paid if we had chosen a fixed price contract and below market, Value at Risk was a proven concept.”

"In addition to Encore's more bespoke services we have found their Value at Risk approach to procurement has brought a further level of control to our process, in particular the regular communication in relation to their live market watch service. This offers exceptional value as internal resources cannot spend all day looking at trading screens, therefore knowing Encore analysts are watching provides considerable comfort.

"We have only given the supplier of the year award to two suppliers in Europe since 2000, both being large raw material and service providers, the award isn't given lightly. Encore is the first support service provider ever to win and was awarded it on the basis of their innovation, flexibility and quality of service."

"It was with some relief that when we approached Encore International Limited, we learnt that it was possible to apply the 'Value at Risk' approach to procurement for an electricity portfolio above 5GWh per year and as such at 60GWh we would have no problem.

"Having entered into a flexible contract that allows us to both fix and unfix the price of power we now have the same level of control and confidence in our electricity procurement as were used to in our gas procurement.

"What really works well is having the visibility of our evolving position each day which is then expertly supported by close interaction with our account manager at Encore, this management by exception process means I can focus my time on bigger spends."

"Operating in the ruthlessly competitive global market that is the brewing industry, there is a need for us to achieve the impossible -have energy price stability whilst at the same time maintain a competitive advantage!

"Using Encore has helped us to manage our energy purchasing in a more effective way and allowed us to address these conflicting objectives.� By applying their risk management techniques we have been able to achieve budget stability without losing the considerable opportunity afforded by falling market prices.

"Adopting this approach on a three year forward basis has meant that our business now has a clear picture of this cost line and can adjust its purchasing strategy to capture benefits in price and any operational flexibility that we may have."�

�Our manufacturing process means that energy costs are a business critical element of our overall cost base.� To help us manage this we first employed the services of Encore in 2004.� By following some simple rules and applying the robust measurement and control of their Value at Risk methodology to our energy procurement process, we have been able to achieve some excellent results during a period of extreme price volatility.�

�We have been utilising Encore�s services for a number of years and have found the application of their Value at Risk methodology to be a rigorous and efficacious tool for managing our energy costs. The true value of the process is its ability to reduce our exposure to a rising market whilst ensuring that we have the ability to participate in any fall in the price when it happens.�

�We have recently adopted Encore�s �value at risk� approach to our gas and power procurement with considerable ease.� The process has added a level of transparency, flexibility and control that had been missing from our previous endeavours and the success of this project has led to a review of how the methodology can be applied to other areas of our business including the management of any Capital spend�

�A solution was found through the utilisation of our service provider Encore International Limited.� By adopting a risk management approach to energy procurement and utilising the principles of both fixing and unfixing the price of electricity, we have been able to systematically reduce risk as electricity prices have risen.� Whilst the cost of our energy spend has increased, we can systematically increase the risk of the portfolio as energy prices fall and the cost of our portfolio declines. This re-optimisation of the portfolio allows us to remove the emotion from the decision making and take difficult decisions even when we don�t believe that the market prices are a fair reflection of value.� Most importantly even though we have a relatively small electricity consumption we are able to operate the process independently, so there is no requirement for us to act as part of a �basket� or �fund� arrangement as some energy advisors advocate. We now manage our portfolio on a rolling basis covering three forward financial years.� The stability and control this gives the business is essential.

�Given that we are based in Newport (Wales) when we started looking for value adding opportunities, it wasn�t long before wind generation came up as an opportunity. The project was originally identified three years ago.� However, volatile market prices made commercial justification difficult as some years it looked economically viable, whilst in other years it seemed not.� In addition there was of course all of the various elements of project due diligence to complete, such as feasibility studies, planning application and commercial modelling�..The benefit of effective economic modelling cannot be underestimated.� We found it beneficial to use an energy specialist to model the economics, linking the value of the project to the markets and tracking that value as the market prices changed over time.� We chose Encore International Limited for this given their history of capital asset appraisal, investment and restructuring.� We also found their knowledge of energy and project markets particularly value adding in the negotiation stage.� Ultimately we could have placed the project without external support, but the value of the service support has been considerable and I believe it�s something all companies thinking about developing projects should consider.�