Despite the welcomed help from the government to the energy sector, the energy market remains as turbulent as ever. The process of an organisation obtaining a quote or contract from a supplier feels similar to the fate of the poor fella on the game show ‘Take me Out’- standing in front of the options to find they are all turning their lights off one by one (seemed an appropriate metaphor with saving of electricity), only to walk up the steps to the tune of “All By Myself”.
So why has the help provided to the sector not yet made it easier for organisations to reduce their costs or obtain quotes? Firstly, it is important to say that the commercial help offered is far different to that of the domestic meter support.
The thresholds that the government have set out minimises who can actually get help. In many cases suppliers themselves are unsure on how to apply the discount. The advice often being, those that qualify for the discount will just have it automatically reduced from their bills.
It seems many organisations that we help are relieved by the Government announcement, and although it is great that this support has been provided, our advice to those is, now is the time to make sure you are not vulnerable to your energy supply in the future. It is scary how many organisations run their energy meters like they would their household energy bills.
In reality, with the shear cost of the bailout that the government has invested, the likelihood of such a bail out ever being able to happen again is highly remote!
Therefore, we encourage our partners and customers to think strategically about energy costs. Make yourself as market-proof as you can. There are products available to you that, whilst not making you immune, will offer you huge amounts of protection. We know of organisations that have protected themselves to the tune of 400% of the market price. They were so protected that they do not get help from the government scheme despite their contracts starting in October. And despite not getting this help, their prices are still considerably lower than they would have been if they were paying the capped price.
Therefore, we encourage you to not be like the man from ‘Take Me Out’, thinking you’re all on your own - reach out to us. We can help you on any level, whether it is contract sourcing, helping you on your green journey, or helping you develop a full energy strategy. We are here to help, you are not on your own.
Here are the questions we’ve been asked frequently in recent months:
Q. Will any quote I have include the price cap?
A. The majority of suppliers are adding the discount after the contract is in place.
Q. What is capped in the scheme?
A. Only the price of the wholesale element of the unit rate. Your unit rate will be made up of many different items, only the wholesale price is capped.
Q. Am I better waiting until the end of the 6 months before renewing?
A. Absolutely not. Any new contract will include the discount if applicable. It is better to get your long term strategy sorted rather than expose yourself to what might be at the end of the 6 months.
Q. What is the wholesale rate that is in effect?
A. For Gas it is £75 per MWh and for Electricity it is £211 per MWh