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The goal is to establish the best strategy and energy pricing for your organization. The key to achieving your goal is market timing (as we have learned from addressing earlier mistakes).
As we start our next installment in this series, let’s recap the mistakes we’ve covered so far when it comes to savvy energy procurement: not procuring proactively, missing the most competitive rates, developing an inappropriate procurement strategy for your specific needs, not having a pre-determined goal of what you want to achieve, utilizing an aggregation […]
We are now halfway through our series on energy procurement mistakes. The first five articles discussed the mistakes of not procuring proactively, missing the most competitive rates, developing an inappropriate energy risk management strategy for your specific needs, not having a pre-determined goal of what you want to achieve, and utilizing an aggregation for purchasing […]
Everybody makes mistakes. The key, as they say, is to learn from our mistakes. In this spirit, we are presenting this series of articles to help you identify some of the errors you might be making so you can break the cycle. The first four articles discussed the mistakes of not procuring proactively, missing the […]
This, our fourth discussion, will center on the importance of measuring your results. The most effective and direct way to manage energy costs comes in the form of sourcing and procuring energy so that you can negotiate the rate you pay – an exercise performed in markets where electricity and natural gas are deregulated.
Currently, more than 15 states have deregulated their electricity markets. Natural gas is deregulated in nearly all states. And while deregulation has created opportunities for savings and reduced electricity costs, it has also created conflicts between those who procure energy and those who manage it.
Many times material change language is broad enough that it touches upon several aspects of the supply agreement. If there is a change in the operations of the company, such as increases in production lines or shutting down of a facility, this can be interpreted as a material change by the energy supplier.
Energy procurement requires a significantly different process than the procurement of most other goods and services. If you’ve been your organization’s procurement officer for any length of time, this is likely not the first time you’ve heard that. This series on the “Top Energy Procurement Mistakes” seeks to explain why this process is such a different beast.
The concept of “usage bandwidth” has to do with the certainty of how much energy you will use (electricity or natural gas) in any given month.
Energy Procurement Mistake No. 2: Missing the Most Competitive Rates We’ve all experienced it: that moment we realize we paid more than we should have. We thought we did our research and negotiated well, but it turned out that someone else got a better deal. If you’ve been getting bids on electricity supply for years, […]
