Looking beyond a typical business energy purchase, have you ever thought, how do suppliers purchase?
As UK suppliers strategically procure their energy portfolio up to 6 years in advance, businesses can benefit from this approach too. By procuring this way, suppliers mitigate outside impacts like political, environmental, and maintenance issues. The uncertainty of global events affects markets worldwide, hence the need for long-term procurement strategies.
But doesn’t this mean I will be paying unnecessary premium for risk?
In short, yes. However, large corporations such as Asda, Tata Steel, Honda, Ford, and NHS procure their energy well in advance to hedge against market uncertainties. This option, typically reserved for high energy users, is now accessible to businesses with moderate energy consumption through Smarta Energy. Our team collaborates with energy suppliers to secure more stable and cost-effective energy prices for your business.
If I have a greater appetite to risk what are my options and is there benefits?
In conclusion, the benefits of being risk-accepting are significant. From cost savings and competitive advantage to innovation and value creation, embracing risk can empower organisations to optimise their energy procurement strategies, stay ahead of the curve, and drive long-term success in a dynamic and evolving energy market. By adopting a proactive and risk-aware mindset, businesses can position themselves for growth and sustainability in an increasingly complex energy landscape. What’s important to understand is the risk associated to this strategy and being able to absorb any short-term impacts that volatile forward curves can throw at you is essential to consider.
If I am in contract for 2 years, is there any point to looking now for the future?
Absolutely, when you purchase energy, you are not just purchasing energy, you also inherit all the taxations and levies that come with it! So even if your risk accepting and you see no need to purchase wholesale this far out, securing your agreement today means you can mitigate the risk of non-energy costs increasing as they do so each year and futureproof your business by fixing this aspect of the contract.
What other benefits do I have for purchasing so far out and moving to risk managed solutions?
Competitive advantage for sure. In a market where agility and responsiveness are key to staying ahead of competitors, being risk-accepting can provide businesses with a competitive advantage. By taking risks and being more proactive in their energy procurement decisions, organisations can differentiate themselves and position themselves as industry leaders.
Can Smarta Energy do all of this?
Put simply, YES, we can!!
Comments