How to Prepare Better if You Have to Retake the ERP Exam

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.

What Is The ERP Exam? What To Expect, And How To Prepare For It

The Energy Risk Professional (ERP) is a new professional designation from GARP aimed at risk professionals working in the physical and financial fields of energy. I was actually studying for the CAIA (Chartered Alternative Investment Analyst) and the CFA (Chartered Financial Analyst) when I became interested in energy risk management. It was intuitive to me to use energy financial instruments for risk management and hedging, but the physical aspects of the energy risk professional designation were not entirely clear to me. Still, I took the plunge and registered for the November exam in summer of 2010.

Little did I know what I had signed up for: The ERP curriculum stretched over nearly two thousand pages, consisted of over 100 readings different and academic papers, some of them very lengthy. Next to a 60 hour work week, the study material was a mountain of work. Organizing the material, summarizing it, reviewing and practicing for the exam were made even more difficult by the lack of study material and preparation resources, as only one (!) practice exam was available at the time.

The curriculum stretches from physical aspects of petroleum (hydrocarbon genesis, refining, transport with tankers, pipelines) over coal and natural gas, to alternative energy such as solar, hydro, wind, and biomass. There is also a segment of nuclear energy, financial trading instruments, valuation of energy transactions, financial disclosure, and laws and regulations. A large part of the material is electricity. The finance part was easy for me, as it covered mainly options, futures, forwards, swaps and little structured derivatives. Energy futures was a different bag altogether, but not too remote from what I already knew.

The physical aspects were much more interesting, as they contained ideas and concepts that were new to me. Even simple truths like the fact that electricity is not storable and what this means for trading electricity derivatives seem trite at first, but when you get into it further, it opens up a whole new universe.

My main challenge was reviewing and learning the study material. I had made a ton of summaries of the original readings, but how should I pack that into my head for the exam? I used a spaced repetition with my summaries in question and answer format, and that was quite effective (but not very efficient, as it ate a lot of time). In retrospect, I spent about 200 hours preparing for the exam, and passed. If this sounds like a lot, it was. There were simply no tools available at the time that I could have used for a shortcut.

If you work in the energy industry, and are involved with risk management, I encourage you to look into the Energy Risk Professional (ERP) from GARP. This designation is new, but I believe it will grow tremendously in importance over the next few years, and has the potential to help you in your career. I wish you all the best for your exam preparation!