In the current market the devaluation of the currency, an increase in government EMR charges imposed on electricity, plus an 85% increase in oil prices since early 2016 ($28/barrel has risen to $52/barrel – still relatively low compared to the all-time peak of $140/barrel) means an increase in gas and electricity prices for the end user. In a market like this the resounding message to your customers should be to lock in their energy prices today to mitigate the risk of having to procure in a potentially higher market in the future. The prices you can obtain will not only be the cheapest in the market, these prices will be locked in for the period specified, allowing your customers to secure their energy prices long term and avoid any nasty surprises with yearly renewals.
Ask your end user this simple question: If you could have secured your petrol prices for the next 5 years at 99p a litre last year, would you have done so? The answer of course would be yes… the same principle applies with energy. Take a small increase now, secure long term at today’s prices and ensure budget certainty. It is also worth remembering that the current wholesale energy price in the UK is still 60% cheaper than when the markets peaked in 2008, so it shows you the possible upside where the UK energy markets could once again reach over the next 5 years. A good short story to use in relation to this is that recently back in July 2016, British Airways brought all their fuel needs for the next 5 years… If it’s good enough for British Airways, then that’s good enough for me.
