Contract Tendering and Procurement
Energy procurement can be a complex task. With our significant buying power and deep long term experience we are able to deliver results, product functionality and prices that are simply unavailable to many businesses or individuals in an isolated market foray.
We deliver understanding and context with the contracts we secure for you as well as a smooth administrative experience to minimise disruption of the accounting procedures client side. Naturally this all manifests itself in the lowest prices and optimum contracting arrangements for all clients as per their agreed objectives with us. MyUtilityGenius group works with businesses of all size and in all sectors. Thanks to our internal expertise and our market knowledge, we can develop bespoke energy purchasing strategies for our clients that ensure tailored solutions rather than shoe-horning a customer into a one-size-fits-all product.
The MyUtilityGenius tender process aims to comply with your own procurement policies and processes, culminating in a full report presenting a comprehensive quantitative and qualitative evaluation of each offer.
We will evaluate your requirements with you and tailor both the ITT and the evaluation according to your criteria; working to overcome any obstacles that may materialise and adjusting strategy when necessary. This means we look at volume risk, credit positions, the term of contract, termination obligations, payment terms and of course absolute price. Whilst the emphasis differs between fixed price procurement and flexible contract procurement (where things such as clip granularity and sell back costs are examples of value propositions unique to flexible contracts), we adopt the same rigorous approach to value capture in both arenas.
Fixed Price Contracts reduce the risk of exposure to future market price increases once struck and enable budgets to be determined accurately at the start of a financial period. MyUtilityGenius can provide fixed priced contracts for up to one, two and three years in advance.
Our expert industry knowledge and relationships enable us to secure the best available prices. We can drive standard transactional based services where the focus is on competition, leverage and margin squeeze; or we can also manage a customer’s market and future budget risk through trigger based execution frameworks. In this case our in house risk desk analyses the trend in market energy prices as well as the merits of paying the risk premium added for securing long dated forward contracts. This view is then cross referenced against market triggers we set with you thereby determining the optimum time to purchase energy. This ensures our clients benefit when market prices are low and their specific budget objectives are protected when they are high. Whichever route a customer chooses to pursue the MyUtilityGenius has a well-developed process for the procurement of electricity and gas providing our clients with significant savings on their energy budgets (up to 40%), and provides full support to ensure you always have a customer account manager available to handle your questions. Our client account managers will take care of the entire process for you, from preparing historical audits to the negotiation and implementation of the contracts.
Flexible Priced Contracts enable clients to separate the supplier selection and margin squeezing exercise; whereby the supplier specific fees and charges are established; from the actual purchase of energy using the wholesale market reference prices.
This separation of decision making allows the customer to take advantage of portfolio theory, gain wholesale market price transparency and in effect manage the market risk in a way that suits their business strategy and objectives. Not least of the benefits is the ability to buy energy within contract year which allows an aggressive customer to remove most if not all of the forward time premium from their price. MyUtilityGenius can provide flexible priced contracts, negotiate the fixed non-energy charges upfront and secure trades throughout the contract to ensure a lock-in if market prices increase (or sell back if the market falls and a customer’s risk policy allows for such activity). Our in house energy purchasers track the market on an hourly basis in order to react quickly on your behalf to price movements, securing the best possible price for every trade. This type of contract we recommend to our larger users of energy. We would recommend that any business seeking to avail themselves of a flexible contract through MyUtilityGenius undertake a RiPPS (Risk Policy and Procedures Strategy) to ensure that they adequately understand all the implications of the product and how best to use it to reduce risk and improve market optimisation. We would see this exercise as forming part of the compliance process implied in the Know Your Customer (KYC) provisions of the FSA when any authorised business explores complex financial products that incorporate some level of risk.