Business Energy Procurement
When it comes to energy procurement for business, our objective is equal to that of our customers: to obtain and secure the most economical supply arrangement available.
Here at Love Energy Savings, we proactively identify new opportunities as the markets evolve. To further reduce costs, we work in partnership with your business to negotiate, prepare and select key supplier contracts to minimise costs and align risk profile.
What Is Business Energy Procurement?
Business energy procurement is the process of finding the best energy solution for your business. A good plan will take into consideration your price, sustainability goals, current energy supply and the future needs of your business.
The best plans are tailor-made to each business. They find ways to reduce your bottom line without compromising on the amount of energy you need.
Types of Business Energy Procurement We Offer
Fixed Energy
The fixed price energy option gives you complete certainty for the duration of your energy contract, allowing you to control your budget with accurate forecasting of energy expenditure.
This type of contract can be fully fixed for up to 5 years and can be reviewed twelve months in advance of the current contract end date, therefore creating absolute certainty over costs for the duration of the agreement.
If you do not wish to be exposed to the volatility of the energy market, a fixed price energy contract will provide you with stability and budget certainty for the full period of your contract.
Benefits of fixed energy procurement
- Regular fixed payments make budgeting easier than with other energy procurement methods
- No rising future commodity and non-commodity costs
- Suppliers absorb the long-term pricing risk
- Less complex than other types of energy procurement
Risks of fixed energy procurement
- Your supplier may increase costs to try and counter the long-term risk
- Does not enable you to take advantage of any price reductions during the contract term
Passthrough Energy
Wholesale charges are fixed. However, non-commodity charges are passed through at the current rate. As a result, a passthrough contract could potentially lower your energy spend.
For organisations that are not averse to risk, do not require a fixed budget and would like more involvement with their energy contract, a passthrough contract could be the answer.
Consumption during peak periods can be expensive. Thankfully, Love Energy Savings works with your business to help you understand how you’re using energy. We’ll then recommend energy efficiency measures that will enable you to take full advantage of an ever-fluctuating market.
Benefits of passthrough energy procurement
- If prices fall, you will be the one to benefit, not the supplier
- You often get a lower price than you would with fixed energy procurement since it’s the consumer who takes on the risk
- You’ll benefit if costs fall in the future
- Great for clients who can manage usage patterns to avoid expensive triad charges
Risks of passthrough energy procurement
- The lack of certainty can be a real issue if you’re on a tight budget
- Third-party costs can fluctuate
- More complex than fixed energy procurement
- Initial cost estimates are no guarantee of future costs
Flexible Procurement
Sometimes, fixed-price contracts are too restrictive. A flexible procurement contract allows clients to take advantage of an ever-changing energy market by spreading the risks associated with energy purchasing.
Love Energy Savings has a fully managed service that maximises choice for you. We help you take advantage of a volatile energy market; that way, you can capitalise on market upward and downward trends, all while reducing your costs.
When you choose flexible procurement with Love Energy Savings, our dedicated procurement specialists will handle the negotiations on your behalf. They will be your point of contact and will manage the relationship with suppliers.
Benefits of flexible procurement:
- Take advantage of fluctuating energy market prices
- Spread the risk over multiple purchase points Provides you with complete control over your energy purchasing
- Benefit from the help and ongoing support of our experienced industry professionals
Risks of flexible procurement:
- It is an involved process and requires you to make complex purchasing decisions, as a result, you will need detailed knowledge of the energy market
- Requires larger tradable volumes in order to access the wholesale market
- Can expose you to some risk if not properly managed
Public Procurement
Public procurement is the process by which government departments or agencies purchase goods and services from the private sector.
Love Energy Savings has a dedicated public procurement division supported by a team of industry specialists with multiple years of experience with EU compliance.
Thankfully, our team is experienced in managing OJEU-compliant tenders. We work in partnership with public sector bodies in order to understand the challenges and opportunities your business faces.
How we can assist with your public procurement:
- Compliance with all EU/public sector procurement legislation
- Formulating, understanding and agreeing on energy purchasing objectives
- Provide you with market advice through access to dedicated energy trader account management
- Competitive tendering and a transparent supplier management process
- Support from knowledgeable energy procurement specialists that have direct experience working within the public sector
- Energy efficiency and sustainable energy initiatives
Business Energy Procurement FAQs
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What Is Business Energy Procurement?
Business energy procurement is when a business obtains and manages the energy it needs for operating. It involves getting electricity or gas from energy suppliers, negotiating contracts, and optimising energy use for cost savings and efficiency.
Think of your business as a high-performance car needing fuel to race. Business energy procurement is like selecting and managing the right fuel sources. It involves working with trusted fuel suppliers, agreeing on optimal deals, and tuning the engine (energy use). This is important for cost efficiency and peak performance, ensuring your business runs like a well-maintained machine.
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Do You Need A Business Energy Procurement Strategy?
Yes, having a strategy for business energy procurement is vital. It helps to secure cost-effective and reliable energy sources, optimise consumption, and navigate contract complexities. This contributes to both financial savings and operational efficiency for your business.
Creating a strategy for business energy procurement means smart planning to ensure your business gets energy efficiently and at the best cost. This includes choosing reliable sources, negotiating well with suppliers, and implementing practices to use energy wisely.
A solid strategy not only saves costs but also boosts the overall efficiency of your business operations, making energy management smoother and more sustainable.
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Do All Businesses Need Energy Procurement?
Yes. All businesses, regardless of the industry size, need to handle energy procurement. Whether it is electricity, gas, or other energy sources, all businesses need energy to function.
Being organised for energy procurement can help to manage costs, ensure a reliable energy supply, and allow you to run your business more smoothly.
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How To Put Together A Business Energy Procurement Strategy
To create a business energy procurement strategy:
- Understand your energy needs by looking at usage patterns.
- Look for trusted energy suppliers through research.
- Agree on favourable contract terms, looking at pricing and flexibility.
- Optimise energy usage with energy-efficient practices and technologies.
- Regularly review and adjust your strategy based on business needs and market changes.
- Consider getting in touch with our energy expert team for more guidance.