Green is good for firms chasing $430b market

Bloomberg

The itch is back for Paul Mead. After almost a decade investing in vineyards and startups in his native New Zealand, the former Barclays Plc and Enron Corp trader wants to return to the power market.
What’s luring Mead is the realisation that efforts to slow global warming through renewable energy and electrification are creating new ways to make money in Europe’s $430 billion power market. Stricter climate targets are spurring investments in wind turbines, solar panels and battery systems, with Bloomberg Intelligence
estimating the market may almost double in size in the next 10 years.
With the European Union, UK and other governments increasingly turning their backs on fossil fuels, companies steeped in that business are looking over the horizon and seeing a new age of electricity. Royal Dutch Shell Plc is on a hiring spree as it plans to spend as much as
$3 billion a year on its new-energies division, and Vitol Group is building out its trading desk. More power traders have changed jobs in 2020 than in the past three years combined, according to Oxwich Search Ltd.
“For those companies that get the right people on board, take advantage of cheap money and position wisely for the future, there will be real gains to be made,” said Mead, 52, who is in talks about a new job.
The major energy companies are adding power plants, retail customers and car-charging networks, and need more staff to help manage those assets. Electricity is a volatile commodity, and traders will try to profit from increasing price swings caused by intermittent wind and solar output.
The vast majority of power traders earn six-figure salaries, recruiters say. For the cream of the crop, guaranteed compensation for changing jobs is between $2 million and $3 million. That still trails the salaries of the best oil traders, but recruiters say the gap likely will narrow in coming years as the now-niche business goes mainstream and attracts more talent.
“We’re seeing unprecedented interest in the market and power traders,” said Jonathan Funnell, head of gas, power and renewables at Proco Commodities, a search firm in London.
“Those that are carbon heavy have realised they need to be
involved in electricity and
renewables.”
About 8,744 terawatt-hours changed hands in the European market last year, according to industry consultant Prospex Research. That could increase to more than 16,000 terawatt-hours by 2030, according to Elchin Mammadov, a senior utilities analyst for Bloomberg Intelligence. The value of the market could jump to more than 630 billion euros ($748 billion) by then, he said.
What sets power traders apart from peers in oil, metals or agriculture is the sheer amount of data they need to track — which fossil-fuel plants are running, ever changing demand, what the technical charts are showing, weather reports and the overall power-generation mix.