7 factors to consider when choosing an energy provider for your business

From ski lodges and farming operations to retail stores and manufacturing companies, energy costs are a significant line item on your profit and loss statement. In deregulated energy markets, such as Alberta, choosing the right retail energy provider for your business can help to substantially reduce energy expenses. By finding the right energy plan for your energy needs you can:

• Improve your bottom line
• Enhance your sustainability efforts
• Impact your organization’s carbon footprint

Navigating the complex world of energy providers, however, can prove to be challenging. With numerous providers vying for your attention, it’s essential to make informed choices when it comes to energy supply. Here are some factors to keep in mind when choosing an energy provider:

1. Total energy costs

There are many different rate plan options available from leading energy providers in Canada. Determining when your organization uses energy and comparing that to the various rate offers is a great first step to determining your total projected energy costs. For example, if you are a manufacturer that runs a second and third shift, then a good amount of your electricity consumption will occur during off-peak hours. Enrolling in an energy supply plan that allows you to take advantage of low-cost, off-peak energy rates could offer significant savings. On the other hand, a municipality that favors budget certainty over savings might want to enroll in a fully-bundled fixed-price plan that offers a single rate for each unit of energy consumed.

The ultimate goal: Assess your business’s energy consumption patterns and financial goals to determine which pricing structure aligns best with your needs.

2. The reliability of the energy provider

When evaluating energy providers for your business, consider their track record of customer service and financial strength. Although local utility companies are responsible for the reliable delivery of energy to your business, an unstable energy supplier could impact you in many different ways. Here are some of the problems that might occur if you choose a provider that is less creditworthy:

• Fixed-rate default: If the provider does not have the financial strength to honor their fixed-rate agreements, then they could default on a fixed-rate forcing your business to purchase energy at new market price levels.
• Customer service issues: Finding a supplier with stellar customer reviews is critical to avoiding customer service problems. Nothing can be more frustrating than trying to solve a problem with a provider who won’t simply respond to your inquiries.
• Contract term change history: Evaluate whether the supplier has a history of changing contract language in the middle of a term. Some suppliers will attempt to enforce material change clauses or bandwidth penalties outside of the contract scope.

The ultimate goal: Find a reputable supplier that is financially sound and has a track record of honoring fixed-rate energy agreements.

3. Contract customization

If you are considering signing a custom contract other than a standard fixed-rate agreement, then you need to consider the supplier’s ability to offer hybrid energy contract structures. For large users of energy, you might want to consider a block and index product or a load-following hybrid plan. It is important to understand the various product plans offered by the energy provider and their willingness to customize a solution for your energy needs. Smaller suppliers do not have the wholesale market credit to offer these unique product structures and simply offer standard fixed-rate or variable-rate plans. Larger suppliers have more flexibility and financial strength to get creative on their energy plans.

The ultimate goal: Find an energy provider that is willing to tailor energy supply solutions to your business’s energy usage patterns and long-term budget needs.

4. The source of the energy

As businesses increasingly prioritize sustainability initiatives and environmental responsibility, the source of energy becomes a consequential consideration. Opting for renewable energy companies that provide energy solely from renewable sources such as wind, solar, or hydroelectric power, can significantly reduce your carbon footprint and contribute to a cleaner, greener future. When evaluating energy providers, ask about their renewable energy options and commitment to sustainable practices. Choosing a provider with a strong focus on decreasing emissions can also enhance your brand reputation.

The ultimate goal: Discover the source of the supplier’s energy purchases in the wholesale market and insist on renewable energy if that is your organization’s goal.

5. Transparency and accountability

Transparency and accountability are fundamental principles that should guide your interactions with energy providers. Look for providers that are transparent about pricing, contract terms, and billing practices. Take note of their regulatory compliance standards and track record of formal complaints. Open communication and a commitment to integrity are crucial when deciding to partner with the company that is going to supply such an essential service to your business.

The ultimate goal: Find an energy provider that is clear, concise, and transparent about their product offering and contract language.

6. Investment in energy technology

To an even greater degree than many industries, the energy industry is undergoing rapid advancements in electricity generation, storage, and distribution. Your provider’s ability to leverage innovative solutions to optimize energy efficiency and performance will directly affect your ultimate costs. Look for providers who offer smart metering, energy monitoring tools, and advanced analytics. These tools empower your business to make data-driven decisions and identify opportunities for cost savings and optimization.

The ultimate goal: Look for energy suppliers that are utilizing the latest technologies in order to deliver low-cost energy to your business.

7. Provider reputation

Beyond all the numbers and facts, an important final factor is the energy provider’s reputation. Research prospective providers through references and online customer reviews. Often, providers will offer reviews and testimonials from existing customers on their website. While these may be biased, they still offer insight into the types of customers working with the provider. You can also consider the provider’s longevity, revenue figures, and track record in the industry.

The ultimate goal: Find an energy provider that has strong financials, a long history serving customers like you, and positive online reviews.

Need help choosing an energy provider?

Choosing the right energy provider for your business involves carefully considering various factors, ranging from cost and reliability to sustainability and innovation. The right energy provider can power your business forward while minimizing your environmental impact. At DNE Resources, our team of energy experts has decades of combined experience helping our customers navigate the complex world of energy providers. Contact us today for help.