EnergyPath is an energy consultancy specializing in electric market financial, economic, strategy and policy risk assessments for clients in the energy industry. Although the roots of the organization lie within power markets, the company also supports risk assessments for investors in other non-power environments. Our clients rely upon us to support their energy market planning, investment and strategy decisions. Some clients prefer only to discover the cost of producing electricity from an energy asset, while others prefer a much more comprehensive risk-based valuation, such as real options analysis, which takes into account the optionality of large, uncertain and irreversible investments. And in both instances, the risks and uncertainties which characterize any energy project are provided to the client in a way that can simplify the investment decision. EnergyPath has proprietary valuation software specifically designed to simulate the operation of a power plant with a rich input format (see Appendix A – EnergyPath Market Model). This data forms the basis for a subsequent real options analysis with a much more detailed investment decision menu. The company is also experimenting with a promising new valuation technology – decoupled NPV – which overcomes problems with the use of risk-adjusted discount rates in discounted cash flow methods.
For operating nuclear plant clients, EnergyPath is frequently asked to support decisions pertaining to fixing or replacing plant components. With EnergyPath’s extensive nuclear plant experience base, and the ability to draw upon the expertise of EnergyPath’s technical and engineering support network, a comprehensive cost-benefit analysis can be performed to render the most economic decision for the client. These also include the decision to uprate the nuclear plant’s capacity-either through taking advantage of the reduced need for extensive safety margins or through steam path modifications.
Clients benefit from EnergyPath’s network of specialists in industry and academia which have earned reputations as advanced thinkers of power market issues-especially important when evaluating risky energy investments. While EnergyPath takes care not to characterize its analyses in hard-to-understand technical, economic or financial jargon, the Company is capable of using the most advanced methods in modern capital budgeting and financial theory in the background EnergyPath also places an emphasis on showing clients the consequences of investment decisions through the use of stochastic modeling which provides results within a probability framework.
Because the Company also has a capability in technology and engineering, clients regularly use EnergyPath for technology assessments-mainly for the purpose of identifying whether a new technology has any value in power markets, and to forecast the likely penetration rate of the new technology. In addition, many clients have asked EnergyPath to use its knowledge of energy markets and its relationship with key players in the energy markets to capture market and competitive intelligence.
EnergyPath has also developed an energy-focused expertise in the use of a value-based methodology for use in strategy development over long time horizons. This method focuses on a matrix comprising market attractiveness and firm sustainable competitive position in order to create firm value and long term growth. EnergyPath also is competent in helping clients perform scenario planning – which takes the very long term into account.
In addition to the company’s economic and financial capabilities, EnergyPath maintains a cadre of associates with engineering and technical skills especially suited to nuclear power plants These skills are diverse and range from engineering analysis of plant systems to licensing and safety analysis support with the Nuclear Regulatory Commission and include nuclear core and fuel design, as well as plant structural analysis.