Electricity and Natural Gas Procurement
Since 1998, many states across the country have enacted legislation that enables energy customers to freely choose their sources of electricity and natural gas. This process is called deregulation, as customers are able to buy their energy from a number of retail energy suppliers rather than according to the regulated utility tariff. Sieben Energy Associates (SEA) helps our clients navigate these choices to find the best combination of supplier qualifications and pricing.
We have consulted on hundreds of millions of dollars of electricity and natural gas transactions, helping our clients save tens of millions of dollars relative to tariff or historic supply rates. Our proprietary approach to energy transactions provides our clients with pricing graphs and presentations that demonstrate the real costs of each supply option. Sorting through supplier pricing proposals can be an overwhelming exercise for energy customers unfamiliar with the jargon and provisions of electricity and natural gas contracts. We are familiar with a variety of different supply agreement options, such as fixed, index, or block-and-index pricing. We help our clients understand the options clearly.
Alternative energy supply has proved to be very popular among commercial, industrial, and institutional customers. Many have generated significant savings under retail contract compared to what they had been paying under tariff. Our clients benefit from alternative supply agreements in several ways. First, they are able to time the markets and complete transactions when the prices are favorable. Careful, advance planning means minimizing price risk. Second, they can sign supply arrangements several years into the future. Timely action can achieve savings to initial forecast and provide a greater degree of certainty around energy budgets. Third, they are often able to enjoy a variety of value-added features from their supplier.
SEA’s energy purchasing team has experience serving both clients who are currently receiving retail supply or who are initially leaving the utility tariff and choosing a retail supplier. Energy prices have generally fell throughout 2009 and 2010 after peaking in summer 2008. During 2011, barring the unexpected, prices are anticipated to remain very favorable, historically speaking. Whether your supply contract is up for renewal soon, or you want to take advantage of attractive pricing for this year or future years, SEA’s energy purchasing team is ready to help you make smart energy transactions.