Presentation from Sustainex 2013

1. Futures Energy Prices
20th March, 2013
Ryan O’ Neill

2. Schneider Electric 2
About Schneider Electric
Global Company
● Headquartered in France
● 175 year history
● $25 Billion in Annual Revenue
● Operating in 140 countries
● 130,000 employees worldwide
● 150 Product Brands
● Ranked 330 on the Fortune
500
Residential 9%
Utilities & Infrastructure 20%
Industrial & machines 24%
Data Centers 17%
Non-residential buildings 30%
Delivering Solutions for End Users
Committed to Innovation
4-5% of sales devoted to R&D

3. Schneider Electric 3
Schneider Electric – Professional Services

4. Schneider Electric 4
World View
Source: European Commission

5. Schneider Electric 5
Overview of Market Place
Source: SEAI
• Heavily dependent on fossil fuels
• Net importer of energy
• Electricity Fuel Mix
• Key driver: Natural gas

6. Schneider Electric 6
What are you paying for?
Important: This is Indicative only

7. Schneider Electric 7
Where are energy prices going?

8. Schneider Electric 8
Price Drivers
• Gas supply & storage
• LNG
• Weather
• Oil
• Economic Growth
• Currencies
• Shale gas?
• Renewables?

9. Schneider Electric 9
55
60
65
70
75
80
pencepertherm NBP movement (Jan 11 to Feb 13)
GY-11
GY-12
GY-13
GY-14

10. Schneider Electric 10
50
55
60
65
70
75
01/01/2010
01/02/2010
01/03/2010
01/04/2010
01/05/2010
01/06/2010
01/07/2010
01/08/2010
01/09/2010
01/10/2010
01/11/2010
01/12/2010
01/01/2011
01/02/2011
01/03/2011
01/04/2011
01/05/2011
01/06/2011
01/07/2011
01/08/2011
01/09/2011
01/10/2011
01/11/2011
01/12/2011
01/01/2012
01/02/2012
01/03/2012
01/04/2012
01/05/2012
01/06/2012
01/07/2012
01/08/2012
01/09/2012
01/10/2012
01/11/2012
01/12/2012
p/therm
Average 2012 UK NBP Gas Price
Average 2012 Gas Price
52.6p/t
74.3p/t
68.8p/t

11. Schneider Electric 11
Managing Risk

12. Schneider Electric 12
How do I manage my exposure?
• This is about your profit margin
• Remaining competitive
• A proactive approach is essential
• Timing is critical
• Business are entering into long term contracts, typically 3 years forward
• Budgetary certainty & market performance, conflicting objectives?
• Both can be achieved with the right tools and expertise

13. Schneider Electric 13
Dynamic Risk Management

14. Schneider Electric 14
Summary
• The only certainty is uncertainty, no easy wins
• No cheap energy prices any time soon
• Increasing charges/taxes
• The way we purchase energy needs to change
• Long term view essential for sustainable growth
• Tools and skills are available
• Business needs to leverage these tools and skills, as the benefits are
significant

15. Schneider Electric 15
Thank You
Questions?