CCRO Meeting, Thursday November 21, 2024
Oliver Wyman Offices
Paseo de la Castellana 216 Pl. 13, Madrid, 28046, Spain
Meeting Room: Oceana
Topics Discussion Hosts
2:15 to 2:45 CET
Model Risk Management Best Practices
Paper will be ready for publication review by December
How can we identify and understand model risk within the context of the energy
industry? Are there best practices for assessing &managing model risk? Starting in 2022,
our members acknowledged the increasing reliance on complex models in our industry,
asking “how might our models be a source of significant risk?” “Model Risk” in our industry
refers the uncertainty arising mainly due to:
• Misspecification – fundamental errors caused by improper development or validation
that cause incorrect results
• Misuse – Incorrect or inappropriate model usage, ignorance of limitations, and other
errors stemming from using a model without full understanding and
• Miscalibration – data-related errors stemming from incorrect inputs or false
parameterization.
We started with a framework for identifying and assessing model risks across a company’s
enterprise. In 2023 we drafted a white paper presenting best practices for an energy
company to implement. That draft is current undergoing rigorous review by members with
significant model risk management experience and expertise, with final edits expected next
month and publication expected in early 2025.
For more information and videos…https://www.ccro.org/scenario-risk-management-best-
practices
Brian O’Neal
Partner
at Weaver
Co-Project Manager [Remote]
Sid Jacobson
Former CRO at Cleco
Members Emeritus
Bob Anderson
Executive Director
at CCRO
2:45 to 3:00 CET 15 Minute Break
Topic Discussion Hosts
3:00 to 3:30 CET
Energy Transition and its Risk Challenges
Updates and next steps
Our CCRO community of energy companies recognizes that to transition from
hydrocarbon reliance, many new risks and opportunities must be understood &managed.
For example, renewable asset deployments require significant capital investments and
operational changes, may result in stranded costs, and are often developing more rapidly
than related markets, corporate strategies, or hedge instruments.
This group aims to address these diverse challenges so as to bring understanding and
establish best practices that lead to advancement of our industry’s risk management.
More info:
Landing page for the group, with links to webinar videos to date…
Jamila Piracci,
Principal
at Roos Innovations
Regulatory Topic Lead
[Remote]
Mike Prokop,
Managing Director
at Alliance Risk
Co-Project Manager
[Remote]
Topics In-person Discussion Hosts
3:30 to 4:00 CET
Scenario-based Risk Analysis &the Energy Transition
Workshop coming in March, using energy transition theme for content
Members today see scenario planning as an essential tool that can explicitly incorporate all
types of uncertainty into risk assessments. Therefore, developing insightful scenarios is
essential to broadening assessments of potential future outcomes and identifying potential
risk management alternatives. Scenarios are particularly important for internal risk review
situations because they enable management to have a shared understanding and a shared
vocabulary for discussing future risks.
The latest project for this group is delivering a Scenario Analysis Workshop at our upcoming
October meeting (Register for the workshop). This workshop seeks to get into the weeds,
by developing scenarios, implementing a model, and assessing the model’s outputs for
insights into mitigation alternatives to think about.
For more information see the group’s web page here:
https://www.ccro.org/scenario-risk-management-best-practices
Chris Dann
Member Emeritus
Co-Project Manager
[Remote]
Brian O’Neal
Partner
at Weaver
Member Emeritus
Oliver Wyman Offices
Paseo de la Castellana 216 Pl. 13, Madrid, 28046, Spain
Meeting Room: Oceana
Topics Discussion Hosts
2:15 to 2:45 CET
Model Risk Management Best Practices
Paper will be ready for publication review by December
How can we identify and understand model risk within the context of the energy
industry? Are there best practices for assessing &managing model risk? Starting in 2022,
our members acknowledged the increasing reliance on complex models in our industry,
asking “how might our models be a source of significant risk?” “Model Risk” in our industry
refers the uncertainty arising mainly due to:
• Misspecification – fundamental errors caused by improper development or validation
that cause incorrect results
• Misuse – Incorrect or inappropriate model usage, ignorance of limitations, and other
errors stemming from using a model without full understanding and
• Miscalibration – data-related errors stemming from incorrect inputs or false
parameterization.
We started with a framework for identifying and assessing model risks across a company’s
enterprise. In 2023 we drafted a white paper presenting best practices for an energy
company to implement. That draft is current undergoing rigorous review by members with
significant model risk management experience and expertise, with final edits expected next
month and publication expected in early 2025.
For more information and videos…https://www.ccro.org/scenario-risk-management-best-
practices
Brian O’Neal
Partner
at Weaver
Co-Project Manager [Remote]
Sid Jacobson
Former CRO at Cleco
Members Emeritus
Bob Anderson
Executive Director
at CCRO
2:45 to 3:00 CET 15 Minute Break
Topic Discussion Hosts
3:00 to 3:30 CET
Energy Transition and its Risk Challenges
Updates and next steps
Our CCRO community of energy companies recognizes that to transition from
hydrocarbon reliance, many new risks and opportunities must be understood &managed.
For example, renewable asset deployments require significant capital investments and
operational changes, may result in stranded costs, and are often developing more rapidly
than related markets, corporate strategies, or hedge instruments.
This group aims to address these diverse challenges so as to bring understanding and
establish best practices that lead to advancement of our industry’s risk management.
More info:
Landing page for the group, with links to webinar videos to date…
Jamila Piracci,
Principal
at Roos Innovations
Regulatory Topic Lead
[Remote]
Mike Prokop,
Managing Director
at Alliance Risk
Co-Project Manager
[Remote]
Topics In-person Discussion Hosts
3:30 to 4:00 CET
Scenario-based Risk Analysis &the Energy Transition
Workshop coming in March, using energy transition theme for content
Members today see scenario planning as an essential tool that can explicitly incorporate all
types of uncertainty into risk assessments. Therefore, developing insightful scenarios is
essential to broadening assessments of potential future outcomes and identifying potential
risk management alternatives. Scenarios are particularly important for internal risk review
situations because they enable management to have a shared understanding and a shared
vocabulary for discussing future risks.
The latest project for this group is delivering a Scenario Analysis Workshop at our upcoming
October meeting (Register for the workshop). This workshop seeks to get into the weeds,
by developing scenarios, implementing a model, and assessing the model’s outputs for
insights into mitigation alternatives to think about.
For more information see the group’s web page here:
https://www.ccro.org/scenario-risk-management-best-practices
Chris Dann
Member Emeritus
Co-Project Manager
[Remote]
Brian O’Neal
Partner
at Weaver
Member Emeritus
