In North America there are:
- 5500+ electric & gas utility companies
- 2500+ electric generation & gas producers
- 5000+ energy brokers, agents, marketers
Where does that leave your company?
Here are a few tips
- Know the energy market drivers
- Know your major energy suppliers & players
- Obtain your best supplier & purchase rate
Contact us for your best choice!
We find about 90% of all energy supply contracts that we review can be improved upon. A supplier’s higher rates, payment terms, contract wording, and deposit/security requirements can often be modified or eliminated. Suppliers are in business like everyone else and their supply offers, quotes, rates and contract wording will differ widely, whether for electricity or natural gas.
TWO MAJOR SUPPLIER CHALLENGES
The largest supplier flaw is that many supplier indexed and fixed rates are simply above market pricing, yet many end-use companies do not take the time to compare energy options or quotes. So whether it’s electricity or natural gas or an indexed or fixed rate, the best course is to check with us to see if it makes sense.
Why pay a higher rate?
We see natural gas fixed rates that are $0.50/dth to $2.00/dth higher than market pricing for the same volume and term.
We also see electricity fixed rates that are $2/MWh to $20/MWh higher than market pricing, for the same volume and term.
The second largest supplier flaw is that many suppliers push fixed rates regardless of where the market is trending.
What sense does it make to fix a rate only to have the market drop shortly thereafter?
If you would like to know other supplier pricing techniques, please contact us.
There are five major areas to consider for “good” energy contracts.
- Supplier – Who are the best potential suppliers and why? There are A+ suppliers and D-suppliers and many in-between suppliers. Knowing your usage patterns and risk tolerance helps pinpoint best suppliers.
- Price/Rate – What are the comparative supplier rates? Is your rate the best? Don’t be surprised at what we show you. There are variable rates, fixed rates and partial hedges. We will help you decide which is best for your company.
- Market Information – Forward-looking information is key. We provide a monthly “In Our Opinion” for our customers, to help set the tone for what we believe is the market direction. Our information is condensed from our group of energy analysts.
- Risk/Term – How risk adverse is your company?
- Credit – Credit is extremely important, but poor credit can often be overcome. How?
Some suppliers offer additional perks with their contracts.
Supplier portals, market information, pricing updates, just to mention a few.
Credit is king. The best A-1 credit demands the best rates and terms. But not everyone has A-1 credit, and as credit ratings slip so do full spectrum pricing options, often requiring security instruments. If you find your company being encumbered with deposits, letters of credit, prepays, etc., check with us and we can often reduce or eliminate these security requirements.
Tips, Tricks and Pitfalls
