Global Energy helps power utilities industry

BOULDER – When we flip a switch, a light goes on, and we typically take it for granted.

Behind that everyday convenience is a complex industry that requires vast amounts of information.

For decades, Boulder County resident Ron McMahan has generated information for the energy industry. In 1981, he founded Resource Data International, which later became Financial Times Energy and then McGraw-Hill Inc.’s Platts.

In 2001, while some derided utility companies as old-economy relics, McMahon saw new opportunities. He then launched Global Energy Decisions Inc.

Backed by a commitment of up to $100 million from the Quadrangle Group LLC, a private-investment fund in New York, he began to weave together six acquisitions and a startup company.

“We started with a clear business plan that identified the companies we wanted to go after,” McMahan noted. “We didn’t have to raise money each time, which allowed us to move quickly.”

Global Energy, headquartered in Boulder, provides integrated data, software and advisory services across a wide spectrum of functions in the utilities industry. Customers include utilities companies, fuel suppliers and transporters, traders, financial institutions, engineering firms and government agencies.

The company’s application suite includes analytic tools for planning, budgeting, market-price forecasting and emissions management. Operations modules handle load forecasting, plant management, maintenance scheduling and other functions.

Most of Global Energy’s 80 employees in Boulder are part the “Velocity Suite” business unit, which provides data and analytical tools for forecasting, planning and benchmarking. The product helps utilities companies maximize revenues, minimize costs, manage emissions, address day-to-day demands and anticipate and plan for long-term needs.

It has garnered one new customer each week since it went into production in April 2004.

Within the next five years, Global Energy plans to double the size of the local business by adding new products and services.

“Boulder is a great place to be if you’re in the energy information business,” McMahan said. “There are a lot of people with industry knowledge.”

Global Energy also has offices in Sacramento, Calif.; Raleigh, N.C.; Houston, Brisbane, Australia and London.

McMahan said the industry is facing a challenging and increasingly complex world. In many places, market forces rather than regulatory fiat determine the price electricity consumers pay. At the same time, environmental concerns constrain the processes of building and operating generating plants and transmission systems.

He found excellent data-gathering capabilities within the industry – software that addressed department-level concerns and an array of independent-market analysts. What was missing, he believed, was a company that integrated and broadened those capabilities to provide comprehensive decision support at the enterprise level rather than “point solutions” for various departments.

Robert Wolaver, senior manager of energy resources at Tri-State Generation and Transmission Association, said his firm’s business was once simple enough that single-user spreadsheets satisfied its decision-support needs.

Mergers and growth then made that approach impractical. When Tri-State needed an enterprise-scale software platform, it turned to Global Energy Decisions.

With the integrated approach of Global Energy Decisions’ EnerPrise software, “We can analyze information in one module and then move the information to another module and make a decision based on it,” Wolaver said, “(It) helps us forecast loads and decide where to buy energy and where to sell it.”

Tri-State also uses products from Global Energy to plan and select sites for new facilities to generate electricity. “It’s integral to our operations,” Wolaver said.

Tri-State, a wholesale electric power supplier owned by 44 electric cooperatives and public power districts, is Colorado’s second-largest electric utility. Based in Westminster, it has coal- and natural gas-fired generating stations in four states as well as more than 5,000 miles of transmission lines that serve rural areas of Colorado, Nebraska, New Mexico and Wyoming.

With about 400 customers worldwide, Global Energy does 40 percent of its business outside of North America.

In partnership with the University of Colorado at Boulder, Global Energy recently hosted a program to train participants in the Korean utilities industry in the workings of competitive markets. The company is also active in the Philippines and is helping the government of South Africa with resource planning for its electricity infrastructure.

Global Energy declined to discuss revenues or profitability.

The business was acquired by Atlanta-based Ventyx Inc., a private firm backed by Vista Equity Partners of San Francisco, in June 2007. Terms of the transaction were not announced.

The sale coincides with a broader rise in investor interest in energy. According to Energy Insights, an International Data Corporation company based in Framingham, Mass., venture capital investment in the energy industry through the third quarter of 2006 was triple that during calendar-year 2005. Drivers, the Energy Insights report said, include market restructuring and regulatory interest in climate change.

Christopher Wood

Christopher Wood is editor and publisher of BizWest, a regional business journal covering Boulder, Broomfield, Larimer and Weld counties. Wood co-founded the Northern Colorado Business Report in 1995 and served as publisher of the Boulder County Business Report until the two publications were merged to form BizWest in 2014. From 1990 to 1995, Wood served as reporter and managing editor of the Denver Business Journal. He is a Marine Corps veteran and a graduate of the University of Colorado Boulder. He has won numerous awards from the Colorado Press Association, Society of Professional Journalists and the Alliance of Area Business Publishers.