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5 Keys to Choosing an Energy Supplier (Beyond Price)
Choosing the right energy supplier can be crucial for success in your business. While energy may seem like an overhead cost to minimize, forming a strategic partnership with the right supplier can help you manage your costs and efficiency from energy supply and beyond.
Current and forecasted energy rates are an important consideration when choosing a supplier – but they aren’t everything. Here are five tips beyond price you can use to evaluate energy suppliers for your business.
The 5 Keys to Choosing an Energy Supplier
Reputation & Credibility
With a relationship this important, you must be confident that the supplier you select is financially stable, credible and reliable. A financially stable supplier can offer your organization peace of mind that they will be there to serve you, even amidst the ups and downs of the energy markets.
Look for a supplier that is fully established across multiple deregulated regions, with years of experience buying and selling in the wholesale markets. When you select a mature and experienced supplier, you open the doors to a customized energy approach that makes the most financial sense for your business – now and into the future.
To find out a little more about a supplier’s credibility and staying power, do a quick internet search or ask these questions:
• How long has the supplier been in business and what is its reputation?
• What is the supplier’s credit rating?
• Who are their long-standing customers and what do they say about the supplier?
It may be difficult to quantify the value of these attributes, but it will be very apparent if things go wrong. Remember, your energy supplier will be around for the term of your contract, so choose a solid supplier that also meets your needs.
You can also look for these reputability warning signs:
• Rates that are far below the average for your industry and area
• Unsustainably high rates that make energy unaffordable for your business
• Bold claims about reliability with little or no evidence to back them up
Clear Contract Terms & Transparent Energy Pricing
As you choose a supplier, consider the differences between contracts. While some suppliers may allow you to purchase electricity or natural gas month-to-month, most will require you to sign on for a six, twelve or twenty-four month term.
Look to contract terms to understand cancelation fees or other barriers to switching suppliers. Likewise, it can be helpful to know upfront whether your contract will auto-renew, expire to a month-to-month variable rate or require you to choose a new rate.
In addition to knowing your contract terms, it’s also important to understand the variable pieces of your energy price.
Be sure your supplier explains how supply and demand components could impact your price. It may benefit you to fix some components and pass through others to increase efficiency and prepare for potential changes to business operations, such as those posed during the COVID-19 pandemic.
By understanding the various costs within your price, you can better determine when to pass components through instead of fixing them. The ideal supplier will partner with you to compare the cost implications of pass-through components and find the best fit for your business, whether it’s a fixed rate, market-based rate or strategic combination of both.
Renewable Options & Industry Experience
Many businesses are looking for ways to implement a broad sustainability strategy and achieve ambitious sustainability goals. If you’re one of them, your supplier plays a pivotal role in building a clean energy solution for your organization.
A credible energy expert can help you increase efficiency and choose the best supply options, ranging from Renewable Energy Credits (RECs) to on-site generation and custom sourced renewable power. In many regions, you can choose to purchase some or all of your energy from local renewable sources. Large organizations often require a combination of solutions to meet sustainability targets, so a reputable supplier with options is key.
Look for a supplier with the industry expertise to seamlessly integrate renewables into your energy portfolio and help you successfully hit your sustainability targets.
Customer Service & Strategic Support
Ensure that the supplier you choose offers an exceptional level of post-sale customer support. An experienced supplier will provide ongoing education to your organization about price and energy markets, if applicable; offer decision-making tools and resources where helpful; and proactively recommend savings programs and opportunities, particularly those related to energy efficiency.
It can be insightful to ask questions about who will be managing your account. When will customer support be available and through what means? Phone, online chat or face-to-face? And are there any fees associated with customer support?
For businesses with a large or complex energy portfolio, a trusted supplier should provide a dedicated Strategic Services team to help drive the success of their energy strategy. For these large commercial and industrial businesses, your account manager should be more than a salesperson – a dedicated energy strategist serves as a resource to help you make informed energy decisions based on market intelligence and your usage. They should bring a deep knowledge of the energy industry to the relationship and a strong desire to help you reach your energy goals.
The size of your business and energy consumption will determine how much support you may require. But a reputable supplier should be able to cater to your individual needs, from simple monthly bill pay inquiries to strategic, year-over-year energy management plans.
Experience with Businesses Like Yours
Different industries and sizes of organizations have unique energy needs. Your energy supplier should understand those distinctions and have experience helping businesses like yours succeed.
Small businesses, which tend to have little room in the budget for flexibility, may value an energy strategy that is predictable, stable and easy to manage. With energy goals focused around reducing costs and gaining budget certainty, small business owners often depend on a supplier who can deliver good prices and energy expertise, so they can remain focused on their business. Fixed rates may give these small business energy buyers peace of mind because the price for the usage portion of the bill will never exceed the price agreed upon in the contract.
Large businesses with larger budgets may look for opportunities for investment-style energy spending. If you can tolerate greater risk, you may be able to capitalize on market lows when prices are good and create a competitive advantage. A total energy management approach integrates a suite of energy solutions with ongoing advice from energy experts to design a custom, nimble strategy that takes advantage of both supply and demand-side factors.
Your strategy and goals also may vary based on your industry. For example, industrial manufacturers may prioritize reducing energy use by optimizing operational schedules for off-peak hours and participating in a demand response program. Conversely, supermarkets and grocery stores may look to reduce energy costs by improving the efficiency of lighting and refrigeration equipment. Governments and agencies may favor working with a supplier that has renewable energy options and can help them deliver energy budgets and strategies transparently to their many stakeholders.
So when you’re shopping for an energy supplier, look for signs that they serve other businesses in your industry with similar-sized energy budgets. If you find a well-rounded supplier that prioritizes your needs, they can help facilitate energy success.
About Direct Energy Business
Your energy needs are unique. It’s time you had an energy supplier that treats you like it. From small businesses to large enterprises, organizations need solutions to buy and use energy in ways that meet their unique needs. Direct Energy Business is the energy supplier with tailored plans and solutions for operations of every size.
They are committed to leveraging their size and strength to deliver solutions that help make their customers’ businesses better across North America’ energy markets. Direct Energy Business serves commercial and industrial customers in 24 U.S. markets and eight Canadian provinces, providing electricity and natural gas supply and energy management services. They are part of Direct Energy, North America’s largest competitive retail energy supplier, serving more than five million customers across North America.
About Broker Online Exchange
Broker Online Exchange (BOX) is the largest and most flexible retail energy network in North America. We satisfy the needs of commercial customers, energy brokers, and affiliates by providing direct access to North America’s top suppliers, markets, personalized support and payment plans.
For commercial energy customers, BOX offers access to the largest and most experienced broker network in the country. We connect customers to professional, specialized energy brokers will help satisfy your energy needs with the industry’s best prices. With over 47,000 accounts served across every market and industry, we know how to help each customers’ specific industry and market combination like no one else.
If you have any questions about our industry-leading energy consultant, referral partner opportunities, or to work with commercial properties looking to save on energy bills, please contact us today!