Best Newcomer of the Year: Woodlands Solutions

With the rollout of version 5.0 of its innovative and cost-effective Phoenix system in 2011, Woodlands Solutions really stepped up its game in the energy trading and risk management (ETRM) software space, competing with long-standing players and scooping Energy Risk’s Best Newcomer of the Year 2012 award

Energy Risk Awards 2012

The Texas-based company was founded in 2008 on the idea that the existing ETRM systems were too expensive, complex to install and difficult to manage, says Michael Muse, president of Woodlands Solutions. “We wanted to create something that would provide the functionality of the major ETRM vendor systems but at a much lower cost.”

This is something its customers believe it has achieved. “[Woodlands’] solution contains the functionality of the major ETRM providers without the major provider price tag,” says David Vreeman, controller at National Fuel Marketing, a marketing company. “Version 5.0 has lots of new features that make it a very compelling option.”

The Phoenix 5.0 system includes advanced features such as multiple at-risk measures, intuitive and quick deal capture (including user-configurable deal blotters), configurable limits functionality, and most notably, integrated business intelligence tools. The latter are based on a data warehouse approach called the ‘Phoenix Core’, which is supported and kept up-to-date by processing servers under a grid computing model. The core is at the centre of the application and is updated in real-time as various users enter or change data.

As well, downstream functions, including position whiteboards, risk analysis, scheduling and settlements, use the data in the Phoenix Core and updates by those functions are made directly to the Phoenix Core. This provides a 'single source of truth' that is always up-to-date within and across the system. It makes for some of the easiest position reporting of any vendor offering on the market today, according to Woodland’s customers. 

“I have spent a lot of time working with the various vendor solutions and truly believe [Woodlands’] approach to position reporting to be one of the best I’ve seen and a true market differentiator,” says Chris David, vice-president, portfolio management and structuring, at natural gas distribution company Repsol Energy North America.

We set out to be as integrated, intuitive and ‘off the shelf’ as possible

The Phoenix 5.0 allows users to see their position data in an intuitive, visual manner. “The system makes position reporting easy and intuitive, so much so that we like to think of the position data as a giant Excel spreadsheet,” says Chris Eichholtz, head of mid office at Eagle Rock Energy Partners. “The various pivot and cube screens allow us to slice and dice our data with few, if any, limits.”

Woodlands’ data warehouse approach is also clearly a compelling draw. “We have seen some of the other vendors provide bolt-on tools that can achieve similar results but none of those tools are as tightly integrated and ‘out of the box’ as the Phoenix approach,” says Baris Ertan, partner at energy consultancy Structure.

As well as creating intuitive and rich functionality, Woodlands Solutions’ other critical mission was to provide it at an affordable price. “One of the most important things for us is to be cost-effective,” says Muse. “We were very aware of the dissatisfaction in the market with regard to cost of ETRM systems, not just from an initial licensing perspective but the total cost of ownership and all of the different costs that go into it,” he says. “A lot of that has to do with the complexity of the system, so we set out to be as integrated, intuitive and ‘off the shelf’ as possible.”

In today’s increasingly regulated environment, position management and reporting are set to become more onerous for companies. Looking forward, Woodlands Solutions wants to ensure it provides the functionality to help companies meet the new regulatory obligations. “We have some other functionality on the road map, but we’re currently focused on addressing the new regulatory requirements. We already capture most of the required data and provide highly flexible real-time reporting, but we’re still working on adding SDR [swap data repository] integration and other new requirements,” says Muse.