Energy Matters: A Case Study
Your Energy Manager
Topic: A Case Study
September 2007
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Independent Energy Consultants, is committed to helping its clients make well-informed and cost-effective decisions regarding their energy supply and consumption. We are sending you this newsletter to help you understand how energy decisions that are made, or not made, effect your company's bottom line.

In this month's newsletter, Independent Energy Consultants, Inc. is pleased to report the success of another natural gas aggregation program that it helped form. We will examine the makeup of this particular buying group and the challenges it presented..
  • The buying group is comprised of approximately 150 accounts - this requires the ability to quickly gather and analyze large quantities of load data;
  • 20 members are participating in the buying group - this requires effective coordination, communication and the ability to make centralized decisions;
  • 2 local utility companies are involved - this requires an understanding of multiple utility rules;
  • The accounts were analyzed and grouped into 4 discrete categories - this requires an understanding of multiple utility tariffs; and
  • 2 suppliers were awarded the various categories of accounts - this requires an understanding of multiple supplier contracts, their enrollment process, billing systems, etc.

The leaders at Independent Energy Consultants have successfully designed, implemented and administered programs for a number of energy buying groups. We are licensed natural gas and electricity brokers and aggregators. If you would like to learn more about the benefits of aggregation and the potential for your commercial, industrial or governmental group, please contact us.
This aggregation program is off to an excellent start. Consider the following.
  • All 150 accounts were successfully enrolled with their new supplier on their first available meter read dates;
  • The four groupings of accounts are currently paying gas costs ranging from $6.93/Dth to $7.77/Mcf;
  • That rate is 40 - 46% less than what these clients were paying before retaining Independent Energy Consultants, Inc.;
  • For the first time in 19-months their rate is lower than the alternative rate from their local utility company; and
  • This program, which spends approximately $2.5 million/year, is being aggressively managed to take advantage of market dips, while maintaining the flexibility to lock-in fixed-rates should the need arise .

Note: The above program is an "opt-in" program where account holders must decide to join the program. We also administer "opt-out" programs where the account holder is automatically included unless it decides not to participate. To our knowledge, of the 100-plus natural gas "opt-out" Governmental Aggregation programs in the state of Ohio, the ones administered by Independent Energy Consultants, Inc. have paid the lowest rates for the past two years. Our rate for October 2007 is $6.94/Mcf. We are pleased to be helping tens of thousands of residents and small commercial accounts manage their energy costs through these aggregation programs.
The Energy Buying Groups that work well, tend to possess many of the following traits:
  • The individual account holders consume similar amounts of energy and in a predictable pattern.
  • Customers possess similar credit risks.
  • The buying group has a single person, or a small group of people, making decisions on behalf of all members.
  • The members share a common goal when it comes to purchasing strategies.
  • One member is not subsidizing the price of another member.
  • Member load profiles compliment each other - more attractive to suppliers when combined.
  • Failure of one member to pay does not impact the rates charged to others.
  • Members are committed to accepting an offer if it is less than a predetermined rate.
  • The group is led by experienced, competent professionals offering independent and objective advice.
  • Members are currently able to shop - i.e., they are not under contract with a deregulated supplier. And
  • Groups are comprised of members who are familiar with each other and/or who have had success with other group purchases.

Contact us for your energy management needs.

phone: (330) 995-2675

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Independent Energy Consultants, Inc. | 820 Deepwoods Drive | Aurora | OH | 44202