Trust is a critical aspect of the commercial energy sector. Customers rely on electricity and natural gas to operate their businesses, run plant operations, and make products. Establishing long-term relationships with energy brokers and suppliers that can provide cost savings and price stability is critical to the success of your business. In this article, we will cover energy customer expectations, common issues with suppliers, and how brokers can help build trust in the market.
The Needs Of Commercial Energy Customers
Commercial energy customers have a variety of energy needs based on their specific operations. From price strategy to gaining access to low-cost energy, customers in deregulated energy states are demanding much from their energy partners. Some of these key needs include:
Cost Transparency
Businesses expect clear pricing structures without hidden fees. Unfortunately, there are many pitfalls in the energy sector related to pricing and unscrupulous business practices. As a commercial buyer with a large energy load, one needs to be able to count on their energy broker or supplier to be transparent in their dealings as it relates to contracting and price negotiations.
Reliability & Stability
Businesses need assurance that their supplier can provide continuous service without disruptions. In the last decade, there have been many bankruptcies in the retail energy markets that leave customers wondering if their fixed rate contracts will be honored. A financially stable energy provider is critical to securing long-term fixed rates that provide budget certainty.
Flexible Contract Terms
Companies need adaptable contracts that align with their energy consumption patterns. In the commercial energy markets, there is no one-size-fits-all solution. Hybrid energy products such as block + index and natural gas hedging are complex deal structures that are ideal for certain types of users.
Sustainability Options
Many businesses are prioritizing renewable energy and carbon reduction strategies. Energy suppliers are providing alternative ways to invest in renewable energy outside of traditional on-site generation. Customers need assurance that these contracts represent the correct amount of renewable energy credits to help them achieve their net zero goals.
Strong Customer Support
Having access to knowledgeable customer service representatives is critical for most energy customers. Let’s face it. Issues are unavoidable. Having a reliable energy broker who can negotiate with energy suppliers on your behalf and handle customer service-related issues is critical to building a long-term and successful relationship.
Key Challenges Faced By Customers
In the modern electricity markets, there are many challenges that customers and energy brokers alike must overcome.
Market Volatility
Commodity markets are driven by physical supply and demand. These fluctuating prices create uncertainty for businesses that are looking to meet budgetary goals. Finding the right prices at the right times is critical to success.
Complicated Billing
Understanding business electricity bills is complicated. Many businesses struggle to understand utility tariffs, regulatory fees, and pass-through charges. It’s important to seek the counsel of an experienced energy broker or consultant who can explain energy contract terms and negotiate key points on your behalf.
Lack Of Accountability
Some energy suppliers fail to deliver on promised rates or contract terms. In fact, there have been many recent regulatory changes aimed at stopping suppliers from overbilling customers after fixed-rate contracts expire and enforcing stricter licensing requirements on energy brokers.
Deregulated Market Complexity
Businesses operating in deregulated states often face challenges in selecting the right supplier. With so many different suppliers and rate offers available, it can be hard to determine which plan is right for your business. Technology has brought a new layer of complexity as customers need to decide if it’s better to shop for energy online or work with an energy broker.
Regulatory Changes
Shifts in energy policies can impact long-term contracts and pricing models. In today’s market, there are several new policies related to natural gas regulation, energy capacity prices, and consumer rights. Working with a professional who understands these changes is key to navigating the market successfully.
Common Issues That Affect Supplier Trust
There are many unhappy customers in deregulated states who have all had negative experiences with energy suppliers. Some of the common problems with energy suppliers that plague the energy market include:
Unexpected Rate Changes
Suppliers have been known to introduce hidden costs or adjust rates in the middle of a contract without proper communication. Some of these adjustments have been blamed on increasing regulatory fees and global issues like the Russia-Ukraine conflict. These customers become frustrated after expecting a single fixed rate to later realize a price increase.
Early Termination Fees & Account Slamming
Businesses often face rigid contracts with unfavorable termination clauses. In some instances, customers are slammed, or enrolled into a supplier agreement without their consent. Furthermore, terminating business energy contracts is nearly impossible. This can create a terrible scenario for the customer as the supplier will attempt to hold them accountable for a contract they didn’t sign.
Unethical Representation Of Energy Plans
Customers frequently report issues with unethical representation of energy price plans. The sales representatives promise one thing and deliver another. It is critical to carefully read the terms and conditions of the energy contract in order to ensure it matches the price offer or quote.
Unreliable Service & Billing Issues
Errors in billing and metering lead to trust issues between customers and suppliers. In many cases, customers are seeking the service of utility bill audit firms to discover these errors and obtain billing refunds. This leaves the customer wondering how to switch energy suppliers away from the erroneous company. For a trusting supplier relationship, customers need transparency in billing structures and cost breakdowns.
Building Trust: The Key Role of Energy Brokers
Energy brokers act as liaisons between commercial customers and energy suppliers. But, customers wonder whether to work with a broker or an energy supplier directly. There are many good reasons to hire an energy broker for your business. Here’s how energy brokers can help:
Expert Guidance In Supplier Selection
Brokers help customers compare rates, contract terms, and supplier reliability. Because brokers have relationships with many suppliers, they have the inside knowledge of which suppliers are reputable. This advice and counsel can save you thousands of dollars in mistakes by choosing the wrong energy supplier.
Transparent Cost Analysis
Energy brokers break down pricing structures to eliminate surprises. An experienced broker can put together a detailed analysis that provides a true comparison between various price offers. Furthermore, the broker can help you forecast your energy costs and anticipate any price increases due to regulatory changes.
Custom Energy Strategies
Brokers assist in selecting the best fixed, variable, or hybrid energy plans based on consumption patterns. A broker can download consumption data from a real-time energy analytics system or obtain historical billing records manually from the utility. Using this information, a broker can help you understand your projected costs and risks based on different price structures.
Ongoing Market Monitoring
Brokers track market trends and notify customers about cost-saving opportunities. This becomes extremely important when your contract expiration nears and you are renewing your energy agreement. In the commercial sector, customers can renew contracts many months in advance based on favorable market prices. A good broker can help you time the market and execute renewals based on low energy futures markets.
Need Expert Counsel From A Nationally Recognized Broker?
Diversegy is a national energy brokerage firm backed by a publicly traded company. Our team of energy market professionals has decades of experience working in the deregulated energy markets and advising our customers on contract terms, price options, and market conditions. If you are looking for an energy expert who can help you navigate the treacherous waters of the energy markets, you’ve come to the right place. Contact us today for an evaluation.
