There are a number of factors that are collectively contributing to the continuing surge in energy costs, such as harsher winters, ongoing inflation, the economic impact of the COVID-19 pandemic, and the conflict between Russia and Ukraine.
“We expect natural gas prices could remain volatile over the coming months, and the way that temperatures affect natural gas demand in February and March will be a key driver of how inventories end the withdrawal season, which will be important for natural gas price formation in the coming months,” the Energy Information Administration (EIA) said in their most recent Short-Term Energy Outlook.
As tends to be the case, the higher costs are also a result of higher demand, though the economic impacts of the ongoing pandemic are still contributing to the rise.
The truth is costs have increased across the energy sector as the economy has recovered from the pandemic-induced lows of 2020. The demand for energy-related commodities has largely returned at a faster rate than production, which has contributed to the higher prices.”
Blake Shaffer, David Brown and Andrew Eckert provided some valuable insight to the energy and environmental policy trends in their recent article.
In our opinion, the most important point they make is that the only thing consumers can do to protect themselves is consider fixed prices contracts: “consumers wishing to be removed from the cut and thrust of wholesale power markets would do well considering a fixed rate for their power. Even with the runup in prices, fixed rates look attractive relative to floating rates for at least the next year.”
They say consider fixing, which is strong advice.
When you choose fixed electricity rates, you’re reducing your vulnerability to market fluctuations and spikes in rates. The energy market is considerably dynamic, and anything can affect electricity prices — from changes in regulation to natural disasters.
What they fail to say is how to get the best price and best offer for you. Not all retailers are the same. Many are capitalizing on the market hype and taking higher margins. How do you know you are getting the best offer? Use a reputable broker with a robust competitive procurement process, leverage your meter data and energy analytics to reduce your consumption, and make the decision with open eyes…
Ready to take a concise look at our energy management options? Connect with our Industry leading energy advisors with a well-established reputation for facilitating high-integrity, fully transparent transactions.
Taking a detailed view of your energy expenses through an analytical lens, we not only work to reduce overall spend and improve energy performance, we protect you from being taken advantage of by service providers – it’s what sets us apart.