What is business energy procurement?
Energy procurement is the process of sourcing gas and electricity contracts for your business by obtaining various supplies from different suppliers. This process involves researching and comparing potential sources of energy, understanding applicable government regulations and laws, negotiating prices or other terms, and finally deciding on a supplier to meet your business's energy needs.
Energy procurement can be complicated due to the varying government regulations, different types of energy contracts available and the many energy suppliers that are out there. That’s why it is important to understand all the options before you sign on any dotted lines.
To help you get started with energy procurement, Resolve has put together this guide which covers the basics of what you need to know.
Why you need a strategy when it comes to business energy contracts
When it comes to a business energy contract, you can't just go with the first supplier you look at. As energy procurement involves a number of factors that can vary depending on your geographic location and specific needs, developing an energy procurement strategy is essential for getting the best deal.
Without an effective energy procurement strategy, businesses can end up paying more for their energy than necessary. This can be due to a lack of market research and an incomplete understanding of the different types of contracts available.
The cost of energy
It is essential to have a well-planned energy procurement strategy when dealing with business contracts, as energy prices can be quite volatile. In recent years, the cost of energy has climbed steadily due to rising demand and limited supply. This can cause businesses to pay more for their energy than necessary if they do not have a comprehensive understanding of the different procurement options available.
Keeping on top of your energy bills
An effective energy procurement plan can ensure that businesses don't miss the renewal dates for their energy contracts. A comprehensive strategy should include researching various suppliers to find the most cost-effective and reliable sources of energy, understanding government regulations, and negotiating prices or other terms. Businesses should also keep close track of their energy bills to ensure they are getting the best possible deal.
Allows you to compare and negotiate contracts
Having an effective energy procurement strategy will allow businesses to compare and negotiate energy contracts more efficiently. By researching various suppliers, understanding applicable government regulations, and negotiating prices and other terms, businesses can maximize their chances of finding the best deal for their energy needs. Additionally, keeping track of energy bills on a regular basis will ensure that businesses are not overpaying for their energy.
How to come up with an energy procurement plan
To come up with a successful energy procurement strategy, businesses need to understand the different types of contracts available and determine which type is the best fit for their needs. Businesses should also research various suppliers to find the most cost-effective and reliable sources of energy. you must have an effective plan.
Look at how much your business spends on energy
The first step in energy procurement is to look at your businesses current position. Analysing how much your business is currently spending on energy is an essential part of having a successful energy procurement strategy. By understanding the current spending, you can identify areas where you are overspending and start to look for ways to save money on your energy costs.
To get a clear picture of your businesses current energy spend, you will need to look at your past bills and analyze them in detail. This means looking at the amount you are spending on energy costs as well as any additional fees or taxes that are relevant to your business.
keep up with the energy market
In order to successfully procure energy, it is important to be aware of the current wholesale prices. By understanding the trends and changes in the market, businesses are able to determine when is the best time to renew their energy contracts. For instance, if spot prices for electricity are lower than expected, then it might be a good time to lock in those prices for the longer term.
Research all suppliers and contracts before signing
Researching all suppliers and contracts before signing is essential for businesses to get the best deal for their energy needs. It is important to compare different suppliers' prices, services, and terms before making a commitment. Businesses should also look at the type of contract they are signing, as some are fixed-term while others are variable-term and will need to be monitored more closely in order to take advantage of any price changes. Furthermore, businesses should also read all the fine print and make sure they understand all the conditions before signing a contract.
Benefits of using a third party to procure my business energy
Although it is important to have a business energy procurement plan, this can be very time consuming and can take up a lot of resources, whilst requiring a lot of expertise.
Using an independent third party to manage your business energy procurement can be a great way to save time and money. Rather than spending hours researching different suppliers, comparing prices and contracts, and dealing with negotiations, a third party can do all of this for you. Here are some more advantages of using a third party broker:
Negotiate the best terms for your business
An energy broker usually works to secure the best energy deal for their client by leveraging their relationships with various energy suppliers. By having strong relationships with suppliers, the broker can negotiate lower prices and better terms than a business could on their own. This can lead to substantial cost savings for businesses in the long run.
Expert market insight
Energy brokers have an in-depth knowledge of the various markets and trends in the energy sector. They are able to identify when prices are expected to rise or fall, and advise their clients on when is the best time to renew their contracts should they wish to take advantage of any price changes. Additionally, brokers can often provide valuable insights into different energy suppliers, helping businesses make the best decision for their needs.
Keep track of energy bills and renewals
An energy broker will also keep track of bills and renewals to ensure that businesses are not signing contracts when prices are too expensive. By monitoring the energy market, brokers can identify when prices are expected to rise or fall, and provide advice on when would be the best time to sign a new contract. Furthermore, brokers can also negotiate better terms or discounts when it comes time to renew a contract.
Procurement with Resolve Energy
Resolve Energy has been a trusted business energy broker for 12 years, helping businesses of all sizes to procure the best deals for their energy needs. Our team of experienced advisors has a deep knowledge of the energy sector and can provide expert market insight to help you identify when prices are expected to rise or fall.
If you are looking for a way to save time, money, and resources when it comes to procuring energy for your business, then getting in touch with us at Resolve Energy is the best solution. We can leverage our strong relationships with different energy suppliers to negotiate the best possible terms and prices for you, providing substantial savings over time.
If you're looking to save money on your energy bills then why not get in touch today? The relationships Resolve Energy has developed with over 24 of the UK’s biggest business energy suppliers allows our energy experts to source the best business energy rates available for your company right when you need them. Request a free quote today and start saving money on your energy.
