Securing new commercial energy contracts that match your budget and site-specific requirements can be a difficult task, especially if you’re having to squeeze this in alongside your day job and don’t necessarily have the time, resource and expertise of how the energy markets work. So, what is commercial energy procurement and is it worthwhile for your business?
Commercial energy & utility procurement is the process of purchasing energy (gas and electricity) on behalf of a business or other commercial entity. Specialist energy procurement consultants like Boxfish, source the right energy deals for their customers based on usage, sustainability and other factors, and act as an extension of your team throughout the whole process.
Likewise, business energy procurement is the process of purchasing energy on behalf of a commercial user. Procurement companies aim to identify contracts that offer competitive value and are appropriate for their customers’ individual requirements.
Typically, energy procurement consultants work in partnership with commercial users to develop an end-to-end strategy for their energy usage needs. This may involve analysing current usage, contract tendering, identifying how best to improve consumption efficiency, looking at value add opportunities and advising on a range of legislative and environmental factors, all designed to minimise costs and carbon, ensuring you remain compliant and help deliver a sustainable future.
Many businesses don’t have the time, resources or expertise to scour the market and decipher complex information to find the right energy deals for their needs. A commercial energy procurement company can help businesses save time and resources, while providing specialist market knowledge to support more informed purchasing decisions and potentially improve overall energy value.
Reduced Energy Costs
Agreeing to the wrong energy contract or buying at the wrong time can be incredibly expensive. There may also be several hidden fees that creep up on you or fluctuating costs based on demand. Whereas most commercial energy procurement company expertly navigate the market and compare suitable contract options to identify competitive pricing and overall value.
Efficiency and Sustainability
Not only will energy procurement services help you to source cost-effective energy for now, but they’ll also forecast what you need for the future. This ensures operational efficiency and assists with planning future budgets. It can also encourage sustainability in that you only procure what you need.
Peace of Mind
Using an energy procurement company gives you peace of mind that your chosen energy plan is the right solution for your business and will cover all your needs in a cost-effective and environmentally friendly manner.
Energy procurement companies use a wealth of knowledge and industry experience to source the right energy contracts for their clients. Approaches may differ slightly from company to company but may include:
A reputable procurement consultant should be transparent about the suppliers and market options it has considered, the scope of its tender process and any limitations on its market access. Where a consultant conducts a competitive tender, it should clearly explain which suppliers were approached and how the resulting offers have been evaluated. This approach provides complete transparency on the offers and enables the client to make an informed decision.
When discussing limitations on market access it’s important to note that third-party energy procurement providers don’t always work with the full market of suppliers as they may benefit more from approaching selected suppliers, which in many cases makes the procurement more expensive. The final decision should always rest with you, the client.
Important to note:
Business energy contracts can differ significantly from domestic energy agreements. Before agreeing to a contract, clients should understand the principal terms, including pricing, contract duration, renewal arrangements, termination conditions and any early exit charges.
At Boxfish, we understand that sustainable energy procurement can be a complex and difficult field to navigate, especially if you’re not an expert and are already pressed for time.
Boxfish offers an incomparable energy procurement service that is designed to reduce the time and cost associated with managing all your energy needs. Learn more about our service online or get in touch for a free consultation.