It can happen to the best of ERP candidates: You received your results and the passing score for the ERP was missed by a hair. This is of course annoying, but please don’t despair. Luckily, you have a second chance to pass and brush up on the study material again to remember it even better for the future. After venting your initial frustration, make sure to get up on your feet again as quickly as possible and get into gear to prepare for retaking the exam. How should you approach this endeavour in the best way? This article highlights the three most important ideas and tips that I email to ERP candidates when they ask me this question.

  1. Focus more on your weak topics, but don’t forget about the topics that you passed. Look at your test scores and find the weaknesses in your exam preparation. Did you start too late? Did you underestimate certain topics? Did you approach certain topics in the wrong way (for example, focusing on qualitative problems, when the exam asked mainly quantitative problems)? But don’t get lost in this, you should know your way around the entire syllabus. I think it’s still much better to know the most salient pooints about each topic on the surface than being completely ignorant about some of the topics. it’s a question of finding the right balance, and making sure this matches with the time you have available for exam preparation.
  2. Focus only on the original ERP syllabus and prepare your own summaries. If you have not already done so, invest in the original ERP syllabus from GARP. There is really no way around this. It used to be possible to get the individual readings individual, but that time has gone. GARP has done a wonderful job at compiling a comprehensive body of knowledge that will cover broad areas of energy risk management. When you work through the syllabus, make it a habit to take notes and thereby make your own summaries of the learning material. It’s not a good idea to rely on third-party summaries alone or on those of previous exam candidates. This can be a helpful complement, but it should not be a substitute for making your own summaries.
  3. Solve as many practice questions and test exams as possible. Even though there are relatively few practice exams for the ERP available, you should make it a goal to get as much real-life exam experience as possible. The GARP sample questions are not good examples of the questions you will encounter in the real exam, so don’t rely on those alone. There are some practice exams from third-party providers available now, one of them being my own. I compiled these questions with the real exam in mind, and while they can’t be a prediction of what will be asked in the exam, they certainly paint a realistic picture of the timing necessary to get through all the questions and the level of complexity of the questions. Feel free to check it out if you have not already done so: ERP Practice Exam.

These are the main points that will prepare you optimally for the ERP exam in case you take it the first time or the second time around. If you take this advice seriously I am absolutely certain that you will improve your exam score dramatically, and with that your chance of passing the ERP exam. Please let me know how it goes with your ERP exam preparation, I always look forward to hearing from you. I wish you all the best in your exam preparation.

Energy-Risk-Professional-lessons-learned

When I took the ERP exam, I was overwhelmed with the preparation like almost all candidates. The sheer amount of reading material (and the lack of preparation material) next to a demanding work schedule seemed almost too much at times, to the point where I was wondering whether enrolling for the ERP had really been such a brilliant idea.

I was lucky enough to pass the exam at the first try, but getting there was stressful, to say the least. In my preparation period, all of my free time was spent reading and learning, with little left for my family and friends. A few times I was tempted to postpone the exam to the next year, but I somehow managed to stay motivated and pushed through. I am very happy I did, but there are a few lessons from my experience that I learned during this time that could probably help future Energy Risk Professionals to design their exam preparation successfully. Even though I think I approached the ERP quite well, there are a few things that I would change to increase my learning effectiveness. Here they are:

    1. Start earlier. I reserved about six months practice time for the ERP. As it turned out this is really the minimum, and I should have allocated at least eight (or even ten) months, including solving practice questions. So if you decide to attempt the ERP, start immediately with your preparation, no matter how early that seems. You can do it in six months (perhaps even less if you have a lot of free time), but for working professionals, ten months would be somewhat comfortable.
    2. Read faster. When I started reading the GARP material, I took much too long to read the original material. In later levels I figured out speed reading and SQ3R, so this helped me tremendously to get through the reading material faster. While I read the ERP study material, I simultaneously took notes in question-answer format (which I turned into my ERP study notes), so this slowed down my process even more but was really a lifesaver in the review phase. Faster reading techniques will help you to have more time available for solving practice problems and to review the syllabus, so I think familiarizing yourself with cursory reading techniques can help you quite a bit in your ERP exam preparation, but also in all your other reading tasks.
    3. Solve as many questions and practice exams as possible. When I took the exam, there were only about 60 practice questions or so out there, which is really not enough to seriously practice for any exam. I also used my ViveraRISK study notes to review, but had I not had those, the exam would have been much more difficult. I know there is still a real scarcity of practice material for the ERP, but make sure you get at least all the available free practice exams from GARP. I also created a realistic ERP Practice Exam, which I think gives you a good impression of what to expect at the exam. Solving practice questions is excellent practice and repetition at the same time. It will also give you an honest assessment of your preparedness for the exam. Make use of all the resources you have to prepared in the best way possible!

These are the main lessons that I learned, and the things I would do differently if I took the ERP all over again. At the moment, I am studying for another finance designation, and I am using these techniques to speed up the process and learn faster. You can do the same to get through your ERP exam preparation faster and more effectively!

Should You Get The Energy Risk Professional (ERP)?This question comes up at least once a week: “Hi Alex, I am a [research economist/trader/risk manager/…] at [energy/power company] and wonder if the ERP is right for me for a career boost. I am currently also studying for an MBA at […]. What you would advise?”

It’s an important question, one that I also asked myself before I studied for the ERP. Here some pointers that may help you in your decision based on my own experience and discussions with other Energy Risk Professionals.

ERP vs. Bachelor’s

For starters, an important thing to understand is that the ERP is not a degree but a professional qualification. So unless you already possess a degree level education, you could not compare the ERP with a university degree or an MBA. Most corporate jobs nowadays necessitate a bachelor’s (BSc or BA) or a master’s (MSc or MA) degree in some form or another, so if you want to climb up the corporate level fast, you first will need at least a bachelor’s degree. This is also a prerequisite to register for the ERP but can be gotten around by means of at least four years of professional work experience.

If you already have a bachelor’s degree or are studying for one and you are working in the energy sector, I recommend you absolutely go for the ERP next to your work/studies. If you don’t have a bachelor’s but enough work experience, the ERP will still help you in your job, and a big plus is that you can do it next to your work at your own pace. It’s really more a matter of priorities, but in general, anyone working in the energy sector could profit from the Energy Risk Professional designation.

ERP vs. Energy MBA

Many business schools offer an MBA in international energy or something similar. An MBA in general is definitely more involved (and much more expensive) than the ERP, and again, the MBA is a degree, while the ERP is “only” a professional designation. An important distinction is that the ERP is geared towards risk management alone, while the MBA also includes management and an array of organizational skills such as marketing and sales.

The applications for an ERP are different from an MBA: The MBA candidate would want to work in an executive position as a director or CEO, while the ERP is geared towards risk management, and not leadership or team management. So if you know you want to work in risk management specifically, the ERP would be preferred, otherwise the MBA will give you a broader education for future career enhancement. If you can do both, that would be ideal in my opinion, but carefully weigh the cost and the benefits with what you really want to do (risk management vs. general management) first.

ERP vs. FRM/CFA/CAIA

GARP offers also the FRM (Financial Risk Manager), which often goes in line with the CFA (Chartered Financial Analyst) and the CAIA (Chartered Alternative Investment Analyst). CFA or CAIA charterholders often also have an FRM. The Energy Risk Professional is the newest of all these professional designations and the only one that really involves energy. Commodities are also part of the CFA and the CAIA curriculum, but only at the margin, while the ERP covers extensively options and financial instruments used for risk management in the energy and financial sector.

In my opinion, these designations are complimentary. So you should not sacrifice one for the other if you have already enrolled. For example, if you’re currently studying for CFA Level 2 but are interested in the ERP also, don’t give up on the CFA but try to do both! There are not many charterholders yet who have the ERP next to the CFA and/or the CAIA, so this may give you an edge. Just do a search on Linkedin for “CFA ERP”, you will be surprised!

Conclusion

As you can see, I would advise almost anyone working or interested in energy to go for the ERP. Why? Mostly, because while it is still relatively new the designation will definitely grow in acceptance and importance in the years to come. I wrote a separate blog post about Energy Risk Professional job prospects, feel free to check it out.

In a nutshell, getting a secondary or tertiary education is always an asset both for yourself and for your employer. If you’re constantly improving your skills you will be bound to send a positive signal to your employer when the time of promotions comes up, and you will possess important and necessary skills that have the potential to give you a career boost.

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