Energy Purchasing Strategy
We at Energycentric can assist you in determining your risk attitude.
Energy now represents a significant proportion of most organisations expenditure and prices are due to rise further as we move to greener energy and a lower carbon economy. Therefore an energy strategy needs to be established so it conforms to the organisations risk management strategy. Options for gas and electricity purchasing have become far more sophisticated with larger companies now benefitting from flexible purchasing contracts and the ability to forward price their contracts. On the other hand, some public sector and SME organisations prefer the stability of fixed price, fixed term contracts.
Any energy purchasing strategy needs to reflect the impact that energy costs and supplies have on the companies’ operations. Regardless of the size of business it is key that your strategy includes how and when to terminate your existing contracts, how much energy you will need going forward and what risk you are prepared to take to secure the best price.
Purchasing energy can no longer be taken in isolation without considering the overall objectives of the business and its approach to risk. The ability to purchase energy based on the future price curve has meant that many businesses are now quite rightly taking a far closer interest in energy procurement and the processes involved.
We at Energycentric can assist you in determining your risk attitude so that a bespoke risk management policy for your business can be implemented. Based on the findings of this policy we can then formulate a purchasing strategy which incorporates the best route to market and a timetable which you can monitor.
An energy purchasing strategy should typically address the following areas:
- How important energy costs are to the overall running and planning of the business
- The ability of the business to absorb or take on any price changes Requirement for budget certainty
- The control and management of the contracting process.
- Roles, responsibilities and authorities of the people involved
- Tactics for the implementation of the strategy
“Having contacted Energycentric following the endorsement from ACEVO in 2009, we have now been working with them for over a year on our energy needs. As a company with multi sites their knowledge has proved invaluable and their ability to purchase gas and electric at the right time has saved us thousands of pounds. We shall continue to work with Energycentric at a time when saving money has never been more important.”
– Guild Care