ERAC Study Guide 2026
Everything you need to pass the ERAC exam in one place: the exam format, every topic to study, real practice questions with explanations, flashcards, and full-length practice tests. Free, no sign-up needed.
📋 ERAC Exam Format at a Glance
📚 ERAC Topics to Study (37)
✍️ Sample ERAC Questions & Answers
1. Which regulatory framework governs greenhouse gas emissions reporting?
The Greenhouse Gas Reporting Program (GHGRP) is an EPA initiative that requires large greenhouse gas (GHG) emission sources, fuel and industrial gas suppliers, and CO2 injection sites in the United States to report their GHG data. This program provides comprehensive data to inform climate policy and track emissions trends across various sectors, including energy. It is a key tool for environmental regulation.
2. What is meant by 'hedging' in energy risk management?
Hedging in energy risk management is the strategic use of financial instruments or physical contracts to offset potential losses from adverse price movements or other market risks. The goal is to reduce or eliminate exposure to specific risks, such as volatile energy prices, by taking an opposite position in a related asset. This helps stabilize revenues and costs for energy producers and consumers.
3. Which key performance indicator (KPI) measures the ratio of useful energy output to total energy input in a facility?
The Energy Utilization Index (EUI) measures energy consumption per square foot per year and is a primary KPI for benchmarking building energy performance.
4. When auditing an energy trading desk, which of the following would be MOST concerning regarding value-at-risk (VaR) model reliability?
Excessive back-testing exceptions indicate the VaR model underestimates actual risk, meaning the model's confidence intervals are not reliable.
5. Which statement BEST describes the relationship between Energy Risk Auditor Certification certification and industry evolution?
Certification requirements evolve to keep pace with professional and technological advances.
6. Under CFTC regulations, a company that regularly makes markets in swaps and whose swap dealing exceeds the de minimis threshold must register as what?
Entities that deal in swaps above the de minimis threshold (currently $8 billion in aggregate gross notional amount) must register as Swap Dealers with the CFTC.