Business energy: buying electricity and gas

Two commodities, two rulebooks

A site may take electricity and natural gas from the same utility and still be making two separate purchases under two separate rulebooks. Electricity choice and gas choice are authorised by different statutes and run through different proceedings, and in several states they are available to different customer classes. The Energy Information Administration describes retail electricity choice as existing in restructured states and generally for customers of investor-owned utilities, and directs a business to its utility or state commission to confirm what applies at an address. The gas map is narrower: the agency's own explainer records that as of December 2022 the District of Columbia and twenty-three states had residential gas choice programmes, notes that commercial and industrial programmes are often broader, and warns that some states limit choice by service area or by customer category. So "is there choice here" is two questions, asked separately, whose answers can differ for one building.

• Electricity and gas are separate markets with separate rules and separate proceedings.
• EIA's electricity position: choice exists in restructured states, generally for investor-owned utility customers.
• EIA's gas figure: as of December 2022, the District of Columbia and twenty-three states ran residential choice programmes, and commercial programmes are often broader.
• Confirm each fuel separately, for the service address, the meter and the customer class.

Where a commercial bill actually moves

Three things change the total, and they are not equally accessible. The supply price is the competitive line and the only one a supplier can bid. Volume is how much energy the site consumes, and it answers to operations rather than to procurement. Capacity is the rate at which the site draws power at its worst moment, and the tariff decides how that moment is measured and charged — which is how an account ends up billed for a load it held for a quarter of an hour. Those last two are different quantities: EIA defines the kilowatt as a unit of power and the kilowatt-hour as the consumption of one kilowatt for one hour, and a commercial bill carries charges for both. The ratio between them is load factor, average load over peak load, and it explains why two sites with identical consumption carry different costs. Working it out needs two figures from your own bill and nothing else.

• Supply price: competitive, and the only line a supplier can bid.
• Volume: responds to how the site operates, not to who supplies it.
• Capacity: priced by the tariff on a short worst-case interval, not on the average.
• Load factor — average load divided by peak load — is the ratio that connects them.

The contract shapes, and what each one commits you to

Suppliers offer a small number of structures, and choosing between them is really a question about who carries the market. A fixed price transfers that risk to the supplier for the term and is priced accordingly. An indexed structure leaves the risk with you, against a benchmark the contract has to name. Time-of-use pricing rewards a site that can genuinely move load out of expensive hours and charges more to one that cannot. A monthly variable arrangement commits you to nothing and is generally the costliest way to cover a year of energy. The structure is a larger decision than the third decimal of a rate, because it decides what a bad month costs. Two qualifications belong in the conversation before anything is signed: a forward price depends on the season the term begins in, so the start month is part of the comparison, and whatever the agreement defines as fixed is what is actually fixed.

• Fixed transfers market risk to the supplier for the term.
• Indexed keeps the risk, against a benchmark the contract names.
• Time-of-use only pays if the site can genuinely move load out of expensive hours.
• Monthly variable is convenient and usually the most expensive way to cover a year.
• A forward price depends on the start month, so quote the season you mean to begin in.

Timing is the lever that outranks the rate

Most of the value in a renegotiation is decided before any supplier is asked for a number. A commercial agreement ends on a date and usually carries a notice deadline that arrives first, and the set of offers available is widest while both are still ahead of you. Once the notice window closes, the price is set by whatever the agreement provides for rather than by a market you can still invite to bid. Working back from the end date, a business needs enough runway to assemble its own usage and demand history, confirm the service details for each account, and run a comparison in which every offer is priced on the same term and the same start month. Ninety to one hundred and twenty days is a workable default for a single site, and a portfolio needs longer because the work multiplies with the number of meters. The deadline itself is stated in the agreement and repeated on the renewal notice; the bill is not the document that carries it.

• The notice deadline usually falls before the end date, and it is the date that constrains you.
• The window for a competed price closes with the notice period, not with the term.
• Allow ninety to one hundred and twenty days for one site, and more for a portfolio.
• Usage history, service details and the agreement itself are the inputs; gather them first.

What a published state average is, and what it is not

Regulators publish average prices, and businesses routinely mistake one for a quote. The Energy Information Administration publishes average retail electricity prices by state and sector, built from reported sales and revenue, which makes it a useful context figure and a poor prediction. It averages every customer in the sector across every utility, rate class and load shape in the state, so it describes a population rather than an account. Where it earns its place is as a range check: work out your own effective price from twelve months of your bills, then ask whether it sits in a plausible band for that state and sector. Where it misleads is as a target, because a demand-metered site with a low load factor can sit well above a state average with nothing actually wrong. Use a published average to notice an anomaly, never as the number to negotiate towards. It is also not directly comparable to your own effective price without care, since it carries commodity and delivery together across every class in the state, so a gap between the two figures is not by itself a finding.

• A state average is assembled from reported sales and revenue across all customers in the sector.
• It blends utilities, rate classes and load shapes, so it cannot describe one account.
• Compute your own effective price first, then use the average as a plausibility check.
• Sitting above a state average is normal for a demand-metered, low-load-factor site.

The order of operations

The sequence is short, and it does not start with a request for rates. First, establish what the account actually is — the service point identifier, the delivery utility, the rate class and the meter type — because those four decide both eligibility and how the site will be priced. Second, confirm that competitive supply exists at that address for each fuel, since a choice state can still contain a municipal utility, a cooperative or a customer class with no retail option. Third, assemble the history: twelve months of consumption and demand, with a note of any operational change since. Fourth, fix the frame — term length and start month — before inviting offers. Fifth, read the disclosure documents rather than the headlines. Sixth, write down the notice date on whatever is signed, because signing creates the next deadline. Where a site reports emissions, the buying instrument has to be chosen alongside the contract, not after it.

• Establish the service point, delivery utility, rate class and meter type.
• Confirm that competitive supply exists for each fuel at that address and class.
• Assemble twelve months of consumption and demand before asking for a price.
• Fix term length and start month, then request every offer on matched terms.
• Read the disclosure documents, and record the notice date the signature creates.

Where an advisor fits, and what this does not claim

An advisor does not change the arithmetic; it changes how much of the market a business sees before a deadline. Supply is sourced through the Broker Online Exchange supplier network, and where a facility decision pulls in connectivity, communications, security or software, those categories come through the AppDirect ecosystem. What that buys is coverage and process: more than one supplier quoting the same account on the same assumptions, with the notice date tracked and the usage history prepared in advance. What it does not buy is a guarantee. There is no rate table here and no savings promise, because a figure that is wrong for a specific account is worse than no figure at all. Availability depends on the service address, the meter and the utility territory that serves it — municipal utilities, cooperatives and some jurisdictions have no retail choice at all. HighGround may receive compensation from providers on completed purchases, and an inquiry places no order and switches no supplier. There is also no substitute for the account's own history: a comparison run on an estimated profile is a comparison of the estimates.

• Options come through the Broker Online Exchange network; adjacent categories through AppDirect.
• Coverage and deadline discipline, not a guaranteed price.
• Eligibility is per service address, meter and territory; some addresses have no choice at all.

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