Fixed Procurement

Fixed Procurement is widely regarded as the preferred energy purchasing strategy, offering businesses the advantage of budget certainty. This approach is particularly beneficial for organisations operating under strict budgetary constraints. By fully fixing your energy contracts, your business is protected from cost variations and market fluctuations, ensuring stable and predictable energy expenses throughout the contract's duration.

​

This strategy enhances financial stability by mitigating the impact of unexpected price increases and is more beneficial in a flat market, reducing the need for complex risk management measures. Fixed-price contracts are straightforward to manage and are especially suitable for businesses with small to medium energy consumption requirements.

​

A key feature of Fixed Procurement is that unit rates remain constant for the entirety of the contract term, which typically ranges from one to three years. Additionally, these contracts offer the flexibility to include renewable energy options, aligning with sustainability goals.

Designed for businesses seeking reliable cost control, Fixed Procurement supports smoother financial forecasting and simplifies the budget planning process, delivering peace of mind.

Flexible Procurement 

Flexible Procurement offers numerous advantages to businesses by enabling them to leverage wholesale fluctuations and engage in forward purchasing during the contract period. This product is particularly beneficial for businesses with medium to high energy consumption requirements. Typically spanning between 1 to 5 years, flexible contracts provide a competitive edge through proactive energy procurement management.

While this type of product entails market volatility risks, these can be effectively mitigated through vigilant monitoring, efficient hedging strategies, and ongoing position reporting.​ A flexible contract offers adaptability in a rising market by securing energy when prices are favourable through forward purchasing, thereby avoiding price spikes. In a falling market, it enables continued purchasing at lower rates, maximising cost savings and reducing financial risk.

​

Businesses can incorporate renewable energy into the flexible procurement strategy. This proactive approach ensures businesses stay informed about market trends and maintain alignment with agreed budget targets. Additionally, with this strategy, you can fix the wholesale costs at any point during the contract period, which adds an extra layer of budget protection.

Pass-Through Procurement 

Pass-Through Procurement offers a transparent pricing mechanism, particularly regarding the non-energy cost element. This product is ideal for businesses with significant energy consumption needs and advanced contract management requirements.

Furthermore, to access Energy-Intensive Industries (EII) discounts, being on this product is essential making it a crucial choice for businesses seeking cost efficiency in their energy procurement.

By reducing supplier risk premiums in fixed non-energy cost components, this product offers cost-saving opportunities. However, it features a complex billing structure, necessitating tailored energy management strategies. This procurement strategy requires the implementation of adaptable budget management approaches.

Throughout the contract lifecycle, you will observe fluctuations in non-energy costs as they are transferred from the network to the supplier, who subsequently passes these costs directly to the consumer.

​

Reconciliation charges arise as networks balance their costs throughout its annual cycle. Pass-through contracts typically span between 1 to 3 years depending on the energy supplier and come with the option to incorporate renewable energy, depending on the supplier.

Power and Gas Purchase Agreements

Power Purchase Agreements (PPAs) and Gas Purchase Agreements (GPAs) represent an advantageous procurement strategy for consumers dedicated to promoting sustainability and advocating for renewable energy. This approach allows businesses to circumvent the substantial capital typically required for investing in renewable infrastructure.

Essentially, PPAs and GPAs involve purchasing energy from existing assets such as wind turbines, solar farms, hydro facilities, or anaerobic digestion plants through agreements facilitated by generators and energy suppliers.

This procurement method is particularly suitable for businesses seeking to commit to longer term renewable contract agreements.

It facilitates access to renewable energy through designed contractual arrangements and pricing models that offer financial stability and budget predictability for clients, providing transparent costs for renewable energy throughout the entire contract lifecycle. Furthermore, this procurement strategy enables businesses to identify the specific assets providing their energy, thereby serving as an excellent option to strengthen their sustainability credentials. PPAs typically span between 3 to 15 years, offering a range of contractual durations.