With more than 170 megawatts of installed capacity, Melton Renewable Energy UK (MRE UK) is one of the top independent generators of renewable energy in the UK. Recently, IBM and one of its UK partners, Aramar, helped MRE UK launch a project to unify and strengthen its financial planning and analysis — improving efficiency so the company can deal even better with the challenges of an industry where demand can go up and down by the day, but large-scale investments have lifecycles measured in decades.
By using IBM Planning Analytics, MRE UK eliminated the need to use spreadsheets as planning tools across its five biomass-powered facilities and 23 methane-powered landfill sites across the country. The financial controllers for the various parts of the business could do their work faster, more consistently, and more accurately for each monthly forecasting and budgeting cycle.
Consolidating financial planning and analysis tasks in IBM Planning Analytics
Jamie Lawton, the Group Reporting Manager for MRE UK, was part of the team that considered many different software solutions for the task at hand. “We were keen to automate as many of our planning processes as we could,” Lawton said, and ultimately, “IBM Planning Analytics offered us the capabilities we were looking for.”
That gives MRE UK’s controllers much more flexibility. According to Lawton, “Our controllers can now budget and forecast their EBITDA, and enter KPI information and cashflow lags, and Planning Analytics will perform the necessary calculations in real time to automate their Cash Flow and Balance Sheet, which saves time and enhances consistency across the Group.”
Even in the case of small changes to variables such as price, the company can now see impacts on cashflow and the balance sheet immediately, which makes it much easier to see the full financial impact of any market change or management decision.
In the long run, the move to IBM Planning Analytics has meant that projects initially considered out of scope — things like modeling royalty payments — can now be brought into the regular scope of work for MRE UK. This expands the ability of MRE UK’s finance team to address any kind of market factor or operational issue that arises in the course of its work.
The outcome: better financial planning and analysis
Through its use of IBM Planning Analytics, MRE UK increased the speed and consistency of its financial planning and reporting functions. It emerged with the ability to rapidly generate management accounts, forecasts, and budgets for assets across the business.
This accelerated financial planning by reducing manual work. For example, it reduced the time to produce what-if scenarios. As Lawton explains, “During a recent annual budgeting exercise, we completed half a dozen what-if scenarios in just two hours — something that would have taken an entire day to complete before. Simpler, ad hoc requests are often faster still, and we can complete some requests in minutes.”
On top of that, IBM Planning Analytics enables more consistent results, offering a single version of the truth across multiple functions — a far cry from having to match up figures across multiple, potentially competing, spreadsheets.
That makes financial planning more efficient, not just in its own right, but in terms of the operations that the planning supports. When financial planning can be matched up accurately and quickly with operational data, rolling forecasts can be completed earlier, and continuous planning cycles proceed without delays.
Find out more about IBM Planning Analytics
In the long run, better financial planning and analysis isn’t just about carrying out finance functions better — it’s about improving the performance of the entire business, from the accounting department all the way to the power plant. That’s what the success of MRE UK demonstrates.