Benchmarking And Energy Procurement

Could your business further reduce their utility costs with efficient energy procurement?

Benchmarking for energy procurement refers to the process of comparing the prices and terms of a company’s energy contracts against industry standards and other market offerings in order to evaluate the competitiveness of the company’s procurement strategy; This process can involve analyzing factors such as energy rates, contract length, supplier reliability, and available energy sources. By benchmarking their procurement practices, companies can identify opportunities to reduce costs and improve their overall energy management strategy.

Benchmarking can be done internally, by comparing different contracts and suppliers used by the company, or externally, by comparing the company’s contracts and terms with those offered by other energy suppliers in the market. This can help companies to negotiate better terms and prices with their existing suppliers, or to identify new suppliers that may offer more favorable terms and reduce energy cost savings over time.

Overall, benchmarking for energy procurement is an important tool for companies to ensure that they are getting the best possible value for their energy purchases, and to stay competitive in a rapidly evolving energy market. So if you are looking for a new supplier, or to find out whether your current procurement process can offer you a reduction in your energy bills, Energy Brokers is here to help.

How to start reducing energy usage, increase efficiency and create a spend analysis

A renewable energy assessment typically involves a review of your current energy consumption and procurement processes. The assessment can be conducted by an energy consultant, supplier, or a broker just like us! Here are some typical steps involved in a procurement assessment:

1. Consumption analysis: The consultant will analyze your utility consumption data to determine how much energy you are using and at what times. From here, a forecast for your future use can be created to use as an overhead to determine your needs in a future supply contract.

2. Contract review: The consultant will review your current energy contracts to identify any inefficiencies or areas where saving costs could be achieved.

3. Market analysis: The consultant will analyze the market to determine the best time to buy energy and which suppliers are offering the most competitive prices; This means many businesses will receive information that can be used as a risk management addition.

4. Risk assessment: The consultant will assess your energy procurement risks, such as price fluctuations or supply chain disruptions, and develop strategies to mitigate those risks.

5. Procurement strategy development: Based on the findings of the assessment, the consultant will develop a strategy tailored to your business needs. This means highlighting some procurement contracts that could fit your needs.

6. Implementation: The consultant will work with you to implement the procurement based strategy, which may involve negotiating with suppliers, signing new contracts, and monitoring energy usage with procurement services. This means taking the action plan created from the information above to analyse cost reduction and find the best strategic approach across sites.

Overall, an energy procurement assessment is designed to help you optimize your energy procurement performance, reduce costs, and minimize risks. It is a valuable tool for any business looking to improve their management practices.

In the UK, there are several common energy procurement options available to businesses. These include:

• Fixed-price contracts: Fixed-price contracts provide businesses with a fixed price for their energy for a set period of time, usually one to three years. This can help businesses budget more effectively and avoid price fluctuations in the energy market.

  • Flexible contracts: Flexible contracts allow businesses to take advantage of market fluctuations by buying energy at different times and prices. This option requires more active management and monitoring of the market, but it can result in significant cost savings.
  • Green energy contracts: Green energy contracts allow businesses to purchase renewable energy, such as wind or solar, to reduce their carbon footprint. These contracts often come at a premium price, but they can help businesses meet sustainability goals.
  • Energy efficiency contracts: Energy efficiency contracts provide businesses with energy-saving technologies, such as LED lighting or smart controls, to reduce energy consumption and costs. The supplier will typically take a share of the savings generated by the technology.
  • Energy-as-a-service contracts: Energy-as-a-service contracts provide businesses with a complete energy management solution, including energy procurement, monitoring, and management. This option can be particularly attractive for businesses looking to outsource their management needs.

  These are just a few examples of the options available to procure energy in the UK. The best option for your business will depend on your energy needs, budget, and sustainability goals. It’s important to work with a reputable supplier or consultant to help you navigate the options and find the best solution for your business.