Electricity brokers function like real estate agents, acting as a bridge between energy suppliers and customers. These types of energy brokers are vital in this growing sector, providing a wealth of knowledge about the energy commodity market to their clients. This article will cover what electricity brokers do and how you can start your career in this industry.
What Is the Primary Goal of An Electricity Broker?
By connecting commercial electricity suppliers to customers, energy brokers act much like real estate agents helping to bridge sellers and buyers. Energy brokers don’t directly sell energy; instead, they act as intermediaries between energy suppliers and customers. Energy brokers are responsible for a lot, handling the following:
Structuring Electricity Contracts
Energy brokers are responsible for understanding the legal jargon used in retail energy contracts they present to their clients. As energy rates can be pretty complex and come with several different product package options, brokers must understand every detail to relay that information to their commercial electricity buyers.
When it comes to energy suppliers, it’s essential to screen and check who you’ll be doing business with. Firms can range from a handful of people to huge companies that rake in billions in revenue. Screening suppliers will help customers know who they’re doing business with and if they can honor that agreement.
Lastly, energy brokers are responsible for customer support. This includes dealing with utility issues, or billing issues, for example. Being available to guide customers through problems is one of the more challenging aspects of being an energy broker.
Facts About the Electric Energy Industry
Electricity production in the United States comes from three sources: fossil fuels (including coal, natural gas, and petroleum), nuclear, and renewable energy. Keep reading for more important facts about the electric energy industry.
Fossil Energy Sources
According to the US Energy Information Administration’s consumption and production facts, natural gas accounted for about 38% of all electricity generated in the United States in 2021. Coal generated 22%, and petroleum was less than 1% of all electricity. As one of the most popular energy sources, fossil fuels remain the number one choice for energy consumption.
Renewable Energy Sources
In the second place, renewable energy sources accounted for about 20% of all electricity generated within the United States in 2021. Hydropower plants produced 6.3%, wind energy generated 6.3%, solar energy produced 2.8%, biomass (steam generators, gas turbines, or internal combustion engines) creating 1.3%, and geothermal energy (steam turbines) accounting for 0.4%.
Nuclear Energy Sources
Nuclear energy within the United States accounted for 19% of all electricity generated in 2021. Using steam turbines, nuclear power plants can produce large amounts of electricity. As the electricity demand grows in the US, nuclear power has helped offset this need of energy consumers.
How To Become an Electricity Broker
If you want to become an energy broker and are unsure where to begin, don’t worry – we can help! The energy industry is an exciting sector that continues to see massive growth opportunities for anyone looking for a lucrative career. Here are three ways to break into the energy broker market:
First Apply as an Agent
For anyone looking to get their foot in the door when it comes to learning electric broker practices, applying as an agent is one of the best ways to break into the electricity broker industry. It’s the agent’s responsibility to act on behalf of energy brokers under their license brokering and selling energy to clients.
Move Up to a Sub-Broker
If you’re considering starting your energy brokerage in the future, it’s a good idea to begin by becoming a sub-broker at a much larger licensed brokerage firm. There are many benefits to becoming a sub-broker – from getting your hands on deregulated markets with no need for a license, access to sell on behalf of major commercial energy suppliers, and consistent cash flow with lucrative commissions.
Become Officially Licensed
For those with experience, it can be a lot easier just to get officially licensed as a broker. However, it’s important to note that this process can be long and tedious, with all applications examined with a fine-toothed comb.
How Electric Energy Brokers Can Find the Best Rates
There are many benefits when using a commercial energy broker, especially in deregulated markets. First, energy brokers specialize in finding the best rates for their customers; it’s about saving their clients money. With a deep understanding of the commodities market, energy brokers can find the lowest prices because they continuously monitor future price patterns.
Deceptive Electricity Broker Practices to Avoid
All industries always have a handful of companies and individuals looking to make quick cash by cheating their customers. Here are three deceptive practices to be aware of & avoid as an electric energy broker:
Sometimes, customers can find themselves in a situation where the supplier sneaks hidden fees into their energy contracts. For example, if the customer uses more energy than forecasted that can result in additional penalties and fees.
Bad Customer Service
In any business, providing top-level customer service is crucial for success. For example, if a customer is having trouble with their energy bill breakdown, they expect their broker to provide a professional response. If the energy broker doesn’t answer on time or is hard to get a hold of, this can leave customers looking elsewhere for their energy needs.
For most customers, inconsistency can be a real turn-off, especially on energy invoices.. When a customer signs an energy contract, they expect billing and the quality of service to be predictable. Without it, customer turnover can skyrocket.
Become an Electricity Broker Today!
As the energy industry continues to show tremendous promise with continued growth, it’s never been a better time to start a career as an electricity broker. For anyone looking to get their foot in the door as an energy broker, Diversegy offers its brokers access to all deregulated markets, pricing rates from over 60 major suppliers, and upfront commission payments. Contact us to become a broker today!