2016 ERP EXAM

Study Guide
Changes

THE ENERGY RISK PROFESSIONAL (ERP) EXAMINATION

The 2016 ERP Examination has been redesigned to better
accommodate the needs of candidates who strive to achieve
the designation. The volume and breadth of content necessary
to assess knowledge of the physical energy markets has grown
in recent years, making preparation for a single, 8-hour exam
increasingly challenging for many candidates. The new 2-part
exam structure provides candidates the choice to complete the
ERP in one or two exam cycles. The newly designed Part I and
Part II Exams remain comprehensive in nature and are designed
to assess knowledge of the physical energy commodity and
electricity markets, trading and structuring of financial energy
contracts, and the tools required to identify, measure, and manage
risk across the energy value chain.
The ERP Exam curriculum is guided by GARPs Energy
Oversight Committee (EOC) comprised of senior practitioners
and academics with diverse backgrounds from across the energy
industry.
2016 ERP STUDY GUIDE CHANGES
The 2016 ERP Study Guide Changes document summarizes
all readings deleted from the 2015 curriculum, and all new core
readings required for 2016. Returning 2015 ERP candidates should
review the curriculum changes before they begin to prepare for
the 2016 examinations.

2016 Energy Risk Professional (ERP) Exam Study Guide

Part I Changes
Introduction to Energy Commodities
and Risk Management
Additions:
1.

Glen Swindle. Valuation of Risk Management in Energy Markets. Cambridge Press (2014).

Chapter 1 Context (Intro for Physical Energy Commodities)

Chapter 2 Forwards and Carry

Chapter 3 Macro Perspective

2. Michel Crouhy, Dan Galai, and Robert Mark. The Essentials of Risk Management, 2nd Edition. McGraw-Hill
Education (2014).

Chapter 1 Risk Management: A Helicopter View

Appendix 1.1 Typology of Risk Exposures

2016 Global Association of Risk Professionals. All rights reserved.

2016 Energy Risk Professional (ERP) Exam Study Guide

Part I Changes
Crude Oil Markets and Refined Products
Additions:
1.

Andrew Inkpen and Michael H. Moffett. The Global Oil and Gas Industry: Management, Strategy and

Finance. PennWell (2011).

Chapter 3 Access, Leasing, and Exploration

2. RINS: Renewable Fuel Standards Hit the Blend Wall. Federal Reserve Bank of Dallas (March 2014).
3. An Introduction to Petroleum Refining and the Production of Ultra Low Sulfur Gasoline and Diesel

Fuel. The International Council on Clean Transportation. MathPro (Oct 2011).

4. What Drives US Gasoline Prices? US Energy Information Administration (Oct 2014).
5. Guide to the Incoterms 2010 Rules & Reference Chart. International Chamber of Commerce (2010).
6. Moving Energy Safely: A Study of the Safe Transport of Hydrocarbons by Pipelines, Tankers and Rail-

cars in Canada. Canadian Senate Committee on Energy, the Environment and Natural Resources
(Aug 2013).

Deletions:
1.

Andrew Inkpen and Michael H. Moffett. The Global Oil and Gas Industry: Management, Strategy and

Finance. PennWell (2011).

Chapter 11 Transportation

2. William Bailey, Benoit Couet, Ashish Bhandari, Soussan Faiz, Sunaram Srinivasan and Helen Weeds.

Unlocking the Value of Real Options. Oilfield Review (2004).

2016 Global Association of Risk Professionals. All rights reserved.

2016 Energy Risk Professional (ERP) Exam Study Guide

Part I Changes
Natural Gas and Coal Markets

Additions:
1.

Center for Global Energy Policy (Columbia University SIPA). The US Shale Gas Revolution and its Impact

on Qatars Position in Gas Markets (March 2015).

2. Niska: Natural Gas Storage Industry Primer.
3. Oxford Energy: US NGL Production and Steam Cracker Substitution (Sept 2014).
4. Condensates. Federal Reserve Bank of Dallas (Q4 2014).
5. Richard K. Morse and Gang He. The Worlds Great Coal Arbitrage: Chinas Coal Import Behavior and Im-

plications for the Global Coal Market (Aug 2010).

Deletions:
1.

Vivek Chandra. Fundamentals of Natural Gas: An International Perspective. PennWell Books (2006).

Chapter 1 The Basics

Chapter 2 Transport and Storage

2016 Global Association of Risk Professionals. All rights reserved.

2016 Energy Risk Professional (ERP) Exam Study Guide

Part I Changes
Electricity Markets and Renewable Generation

Additions:
1.

Daniel Kirschen and Goran Strbac. Fundamentals of Power System Economics (2004).

Chapter 6 Transmission

2. Federal Energy Regulatory Commission: Operator Initiated Commitments in RTO and ISO Markets (Dec
2014).
3. Kenneth Skinner. Heat Rates, Spark Spreads and the Economics of Tolling Agreements (Dec 2010).
4. Advanced Energy Economy Institute. Integrating Renewable Energy into the Electricity Grid (June 2015).
5. MIT Interdisciplinary Study. The Future of Solar Energy (2015).

Chapter 1 Introduction and Overview

Chapter 4 Solar PV Installations

Chapter 8 Integration of Solar Generation in Wholesale Electricity Markets

6. Andrea Roncoroni, Gianluca Fusai, Mark Cummins, eds. Handbook of Multi-Commodity Markets and

Products: Structuring, Trading and Risk Management. Wiley (2015).

Chapter 5 Emissions Markets and Products

Deletions:
1.

Steven Stoft. Power System Economics: Designing Markets for Electricity. IEEE Press (2002).

Chapter 3-1: Introduction

Chapter 3-2: The Two-Settlement System

Chapter 3-3: Day-Ahead Market Designs

Chapter 3-5: The Day-Ahead Market in Theory

Chapter 3-6: The Real-Time Market in Theory

2. IEA Coal Industry Advisory Board. The Impact of Global Coal Supply on Worldwide Electricity Systems:

Overview of Europe, the United States, Australia, Japan, China, and South Africa (2014).
3. Chris Groobey, John Pierce, Michael Faber and Greg Broome. Project Finance Primer for Renewable En-

ergy and Clean Tech Projects (Aug 2010).

4. Jeffery Altman, Ross Board, Felix ab Egg, Andreas Granata, and Hans Poser. Development and Integra-

tion of Renewable Energy: Lessons Learned from Germany (July 2014).

5. Bo Shen, Girish Ghatikhar, Chun Chun Ni, and Junqiao Dudley. Addressing Energy Demand through De-

mand Response. Berkeley National Laboratory (June 2012).

6. Rebecca Busby. Wind Power: The Industry Grows Up. PennWell (2012).

Chapter 7 Wind Power Integration: Striking a New Balance

2016 Global Association of Risk Professionals. All rights reserved.

2016 Energy Risk Professional (ERP) Exam Study Guide

Part II Changes
Price Formation in Energy Markets

Additions:
1.

Hillard Huntington, Saud M. Al-Fattah, Zhuo Huang, Michael Guewa, and Ali Nouri. Oil Price Drivers and

Movements: The Challenge for Future Research (2012 Rev. 2013).

Deletions:
1.

Michael Miller. Mathematics and Statistics for Financial Risk Management. Wiley & Sons, Inc. (2014).

Chapter 6 Bayesian Analysis

2016 Global Association of Risk Professionals. All rights reserved.

2016 Energy Risk Professional (ERP) Exam Study Guide

Part II Changes
Financial Energy Products

Additions:
1.

Financial Conduct Authority: Regulating the Commodity Markets: A Guide to the Role of the FCA (Feb
2014).

Deletions:
1.

Craig Pirrong, The Economics of Commodity Trading Firms (March 2014).

2016 Global Association of Risk Professionals. All rights reserved.

2016 Energy Risk Professional (ERP) Exam Study Guide

Part II Changes
Risk Management Tools

Additions:
1.

Glen Swindle. Valuation and Risk Management in Energy Markets. Cambridge Press (2014).

Chapter 16 Control, Risk Metrics, and Credit

2. John C. Hull. Risk Management and Financial Institutions. Wiley & Sons (2015).

Chapter 24 Liquidity Risk

3. OCC: Oil and Gas Production Lending (April 2014).

4. Aswath Damodaran: Country Risk Determinants, Measures and Implications (July 2015).
5. Oxford Energy: Kenya: An African Oil Upstart in Transition (Oct 2014).

Deletions:
1.

Kevin Dowd. Measuring Market Risk, Second Edition. Wiley & Sons (2005).

Chapter 14 Liquidity Risk

2. Betty Simkins and Russell Simkins. Energy Finance and Economics: Analysis and Valuation, Risk Manage-

ment, and the Future of Energy (2013).

Chapter 9 Financial Statement Analysis for Oil and Gas Companies and Competitive Benchmarking

3. Jon Gregory. Counterparty Credit Risk and Credit Value Adjustment: A Continuing Challenge for Global

Financial Markets. Wiley & Sons (2012).

Chapter 10 Default Probability, Credit Spreads, and Credit Derivatives

Chapter 15 Wrong-Way Risk

4. Daniel Wagner. Managing Country Risk (2012).

Chapter 3 Assessing Country Risk

Chapter 4 Country Risk Assessment in Practice

5. COSO. Risk Assessment in Practice (October 2012).

6. Robert Bea, Ian Mitroff, Daniel Farber, Howard Foster and Karlene H. Roberts. A New Approach to Risk:

The Implications of E3 (2009).

2016 Global Association of Risk Professionals. All rights reserved.

2016 Energy Risk Professional (ERP) Exam Study Guide

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About GARP | The Global Association of Risk Professionals (GARP) is a not-for-profit global membership organization dedicated to
preparing professionals and organizations to make better informed risk decisions. Membership represents over 150,000 risk management practitioners and researchers from banks, investment management firms, government agencies, academic institutions, and
corporations from more than 195 countries and territories. GARP administers the Financial Risk Manager (FRM) and the Energy Risk
Professional (ERP) exams; certifications recognized by risk professionals worldwide. GARP also helps advance the role of risk management via comprehensive professional education and training for professionals of all levels.

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2016 Global Association of Risk Professionals. All rights reserved.