Fuel Procurement |
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H&H Energy Management can help you save money by aiding in the bulk purchase of your fuel. H&H helps clients navigate the world of procurement, establish quality contract terms and conditions, and consult regarding risk management within your organization.
What is Fuel Procurement? Fuel procurement is the procurement (locating and purchasing) of energy (natural gas, electricity, fuel oil, biomass, ect..). Cost effective energy procurement requires understanding of the market, regulatory limitations and opportunities, and contingency planning.
Electric Procurement The EPACT of 1992 removed the Federal prohibition against electric deregulation and allowed states to become deregulated on a state-by-state basis. The State of Wisconsin maintains a regulated state for electric distribution, meaning a facility can only purchase electricity from the local distribution company (LDC), or electric utility company (WE Energies, Alliant Energy, WPS, ect..) and has no other choice. In deregulated states, facilities are able to buy from a power marketer or broker who will draft an agreement to purchase the electricity at a certain price from the source of generation. The facility then has to pay all trasmission charges.
Natural Gas Procurement The Natural Gas Policy Act of 1978 allowed natural gas deregulation. Since then, deregulation has helped keep prices to the consumer lower, and also in check, by allowing competition play a part. Facilities are allowed to buy natural gas from their local distribution company (WE Energies, Alliant Energy, ect..) at a firm rate or interruptible rate as well as interstate pipeline company or a gas marketer.
Benefits of Fuel Procurement Fuel procurement can allow a facility to save money by obtaining fuel at a lower cost than what the local distribution company sells it at. A company or facility that uses more than 50,000 therms per year may be able to achieve lower prices through a negotiated gas rate. |
