What are the pros and cons of flexible energy purchasing?

The energy market is in a constant state of flux and energy prices can be highly volatile, going up and down depending on a huge range of factors. Due to the nature of this product, there are higher risks when compared to fixed energy purchasing, especially if energy users do not have robust energy purchasing policies and strategies with the right risk management tools in place.

Flexible energy purchasing also opens up additional potential cost savings on the non-commodity elements of the bill. Demand management, demand response and load shifting opportunities could see distribution and transmission charges reduced if utilised correctly.

When setting up the flexible energy supply contract, an energy user can opt to fix some or all non-commodity charges. However this comes at a premium and more often than not these charges remain unfixed for the contract duration and are passed through at the published rates, which can be validated.

At amber, our award-winning team of procurement experts can help your business to achieve the desired results, carefully monitoring the market to minimise risks and take advantage of any opportunities. By strategically purchasing energy at points throughout the year we can hedge against adverse price movements.

FAQJoe Hickman