Ralph L. Genesi

W-G: Why was NewEnergy Associates acquired recently by Siemens Westinghouse Power Corporation?

RG: Power-generating companies require IT solutions to improve their competitive position in global energy markets. This has become a strategic initiative in the industry. Generation-specific IT solutions are in demand and integrated applications over the entire value chain are a requirement. This demand is forming a global market that will be worth over $1.8 billion dollars by 2006 or 2007. When we at Siemens analyzed our strong market presence and product lines, we found that NewEnergy complemented our power enterprise value chain offering with its comprehensive planning and operating strategy software applications and consulting services. NewEnergy is well established in the market with an outstanding reputation, producing best-in-class software applications complemented by leading edge platform and communications technology solutions. As the center of competence for Siemens Westinghouse Power IT Solutions, NewEnergy is our source for providing end-to-end solutions. It's now connected with many areas in our Power Generation business unit in North America as well as around the world

W-G: What is the number one issue facing power producers today?

RG: Unfortunately, it's not a single issue. There is a combination of issues to contend with: a slumping economy, environmental regulations, deregulation, fluctuating fuel costs, capital market pressure, and inadequate technology and infrastructure. Now, combine these issues with the turmoil in the energy industry over the past 12 to 18 months, and you have created challenges for power producers that will undoubtedly appear as case studies in business schools for years to come.

W-G: Those are substantial issues to deal with.

RG: Yes, they are. And unfortunately, there is no silver bullet to address them all. However, one approach is to commit and invest in information technology solutions that integrate and support sophisticated market performance and strategic analysis capabilities, thereby delivering decision support and operations management to energy professionals from the plant operator to the risk manager, to the trading floor, and the corporate office. Companies that adopt this technology and collaborative methodology will surface as industry leaders.

W-G: Does your organization offer consulting services to assist clients in this area?

RG: Yes, we do. NewEnergy has a recognized staff of industry experts who consult on a continual basis in the areas of process design, process optimization, market assessment, standard market design evaluation, locational market price forecasting, load forecasting, asset valuation, and a multitude of other enterprise-driven, strategic corporate initiatives. We see this as a valuable asset to our clients.

W-G: What new development can we expect from NewEnergy in 2003?

RG: Well, the list is long, which is always the case at NewEnergy. Our R&D investment has always been well above industry standards. Significant investments are being applied toward enhancing our industry-leading Corporate Financial Management system, Impact. We are adding capabilities that will make it even easier for widely dispersed business units to consolidate forecasts for strategic and tactical planning. Resources are also being applied to our state-of-the-art Trading & Risk Management System, Monaco. For example, we will be rolling out the gas storage valuation engine to complement the already best-in-class plant modeling and valuation algorithms. Of particular note is the work being done to add geographical visualization of model results to our power system modeling tools, such as PROMOD IV. And with the advent of LMP [Locational Marginal Pricing], we continue to invest in making sure our pricing and valuation techniques are second to none.

W-G: What recent development are you most excited about?

RG: It's hard to choose, but the work we are rolling out around our power system data model, PowerBase, is very exciting. As you might imagine, all the fancy mathematical modeling techniques in the world are useless if your analysis is not based on an accurate, comprehensive and flexible source of power system and market data. Our clients recognize this as a key driver in establishing true competitive advantage. The most recent release of PowerBase includes not only highly reliable data from numerous industry sources, but it also incorporates the data within a framework that provides for tightly integrated "what-if" scenarios. In doing so, it truly sets a new standard in how strategic and tactical planners will manipulate and use their power system data to uncover hidden opportunities.