Whether you are a small-business owner or the CEO of a Fortune 500 company, you know the importance of making every dollar count. Many companies waste money on common energy contract mistakes and don’t realize it.

Here are some common mistakes and how to avoid them:

Do Your Research!

When searching for the best energy contact, time spent researching the right fit will pay off. All energy companies and contracts are not created equal. One thing to consider is which companies in your area have the best reputation for service and affordable pricing. Choose a reputable, long-lasting supplier so you can have confidence they will be there for years to come.

Get The Most Competitive Offers

Part of doing your research is getting many bids to compare. A common mistake is to get bids from only two or three companies and then go with the best one of this limited sample. Instead, Energy Professionals can help you get the most competitive offers in your area. With your location and service type, we can ensure you are getting the best deal.

Read The Fine Print

Once you’ve chosen the best energy supplier for your needs, look over the contract carefully. It is common these days to just click “agree” or sign a document without reading everything. After all, who has the time to read pages and pages of details? This is a case where time invested now has the potential to save money in the long run.

Will your rates go up if national or regional energy rates fluctuate? Is there an early termination fee? Will energy outages affect your rates? Read the fine print and find out.

Think Ahead

Though energy usage can at times be unpredictable, you can often foresee periods of heavy usage and plan accordingly. Does your air conditioning run steadily all year, or is it likely to increase during the summer? Does your company put up a large holiday display using many lights during the winter months? Are there other events or conditions that will increase your usage temporarily? If you think ahead, you can ensure your contract is designed to accommodate these times.

Fixed Vs. Variable Rates

Energy companies will usually offer either fixed or variable-rate contracts. There are advantages and disadvantages to each depending on your company’s individual needs.

With a fixed-rate contract, your monthly energy bill will be predictable, allowing for certainty in your monthly budget. If energy prices go up, your fixed rate protects you from a budget increase for the duration of your contract. However, if energy prices drop you will need to wait for the end of your contract to take advantage of the lower rate.

A variable-rate contract allows lower energy prices to take effect immediately. However, increases in energy market rates will affect your energy bill negatively. In addition, variable rates can make budgeting for energy costs unpredictable. Planning ahead (as discussed earlier) can help to mitigate this as a factor.

Know When Your Contract is Going to Expire

It is important to know when your energy contract is set to expire. Sometimes contracts have a clause allowing a change to variable rates if your fixed-rate contract expires. Know your expiration date and start researching options beforehand. Energy Professionals can help ensure you always receive the most competitive rates.

The Best Energy Contract is Easier to Find Than You Think

Energy Professionals focuses on energy management by using audits and software data analytics, and by identifying energy-saving strategies and opportunities. We can help ensure you have an energy contract that best fits your business’ needs. Contact us today to get started.

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Natural gas prices in the United States are trading high in front-month and forward-month contracts, a trend we can expect to continue.

This comes as an unfortunate surprise to many energy consumers, who have seen low natural gas prices for several years running.

As we face a potentially colder winter, be prepared and looking ahead.

The Rise and Fall of Gas

Natural gas in the United States is primarily used industrially, to heat homes, or (about 35% of the time) to generate electricity.  Commercial use of natural gas is actually one of the lowest categories of use, less than 14%.

So, naturally, natural gas demand tends to follow temperatures, particularly in the northeastern part of the United States.

Natural gas pricing saw multi-year decreases but has recently turned a corner: trading over $4.00/mmBTU in forward months for several months ahead.

It’s a great time to have stock in natgas, not the best time to rely upon it for heating or other purposes.

Store and Use Natural Gas

For those commercial or industrial applications of natural gas, storage is crucial for pricing. With adequate volume and storage, a business or industry has the ability to buy at lowest points (such as warmer months) and use when costs are higher.

As a storage and backup power solution, natural gas allows for onsite energy generation, which means:

  • Independence from the energy grid for vital operations, even in the event of a blackout.
  • Backup power to supplement energy usage and reduce peak charges.
  • Emergency fuel supply when temperatures drop.
  • In some states, incentive from the local utility to generate electricity onsite.

If you currently utilize natural gas, are considering making it part of your overall energy plan, or wonder if natural gas is right for you, an Energy Professionals energy consultant can examine your industry and site-specific needs to determine the best course of action.

Switching the Gas Off

If you’ve grown weary of energy fluctuations in the natural gas market, it may be time to consider a switch to onsite solar panels.

While buying “energy credits” for off-site green energy generation is still usually more expensive than traditional energy purchasing, on-site solar panels come at much less cost.

Just as a convergence in market factors have created a surge in natural gas pricing, another market convergence has resulted in best-possible pricing in solar energy at this time:

  • Solar panels and solar installation costs are down
  • Incentives from local, state and federal programs have boosted the rebates available to solar projects
  • Third-party funding options have enabled low or no-cost solar installations across the country
  • Energy buy-back agreements, power purchase agreements, and other options continue to grow across the United States.

What’s more, even in northern states (outside of Alaska), you probably get enough sunlight to generate enough power–it only takes 4 hours of sunlight for today’s typical solar panels to fully charge.  With onsite battery storage, one can even store additional solar energy for overcast or stormy days absent of sunlight.

Energy Professionals Knows

With so many market variables and options available, energy prices can be convoluted and virtually impossible to compare.

Fortunately, we have assembled a team of experts.

We work independently from the utility and other energy providers so that we have only one purpose: to save you money on your energy bill.

We can help you “market proof” your energy expenses, save on your current utility, plan for an “off the grid” energy future, or whatever your utility goals may be for the future.

Contact us today for a free energy soft audit and to find out how to get started saving money every month!

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Going green is a hot growing trend with no signs of slowing.

From conscientious consumers who want to spend their dollars on environmentally-friendly design or products, to investors looking to capitalize on the trend, there’s never been a better time to jump on the green-hued bandwagon.

But getting green certification can come at additional cost. Is it worth it?

Launching Green

One of the most common certifications in the United States is LEED building certification.

LEED stands for Leadership in Energy and Environmental Design and is an independent certification process by the U.S. Green Building Council (USGBC). Points are awarded, throughout the building process, for such varied initiatives as recirculating cooling systems or hiring a LEED-certified builder. There are 4 levels of certification, including:

  • LEED Certified buildings (40–49 points)
  • LEED Silver buildings (50–59 points)
  • LEED Gold buildings (60–79 points)
  • LEED Platinum buildings (80 or more points)

Pros: Certification, like LEED, offers a great boon to public relations. The USGBC also reports that LEED buildings lease-up faster, retain higher property values, and may garner tax rebates and zoning allowances not offered to other developments. Like certain other environmentally-friendly practices, green building may be “recession-proof”: even when new construction declined during the Great Recession real-estate bubble burst, “the total square footage of LEED-certified buildings grew by 14%.”

Cons: Such certifications may indicate environmentally-friendly design principals, but they relate only to new construction, and not to occupancy usage, so they may not save money in the long-run.

Turning Green

Other than a new development, many businesses seek out environmentally-friendly changes because of potential cost savings of green design.

Reusing runoff water saves landscaping expenses and allows for drought-season watering.

Installing solar panels reduces energy bill expenses, and prevents brownout and blackout conditions for a business (crucial in high-security or high-needs environments like schools and hospitals).

Utilizing Energy Star appliances, and other smarter-energy appliances can save thousands of dollars in energy over the life of an appliance.

The possibilities are virtually limitless.

So, for many more businesses “going green” is not just about new construction, it is about tangible, cost-saving measures that can be implemented in existing facilities, and then promoted to your investors, partner businesses and consumers for additional public relations benefits.

Growing Green

For those businesses wishing to save money on utility expenses, capitalize on tax incentives, or gain market edge in their industries with environmentally-friendly design, the main problem is deciding where to start.

Do you put recycling bins in the office break room?

Such small changes go unnoticed by the public.

Do you insist that everyone scale back on their individual electricity use, such as only one computer monitor, fewer appliances, and lower lighting?

Such changes might not make much impact on the bottom line and may cause more inconvenience than savings.

A great first step is to get an energy audit.

An energy soft audit, with an experienced energy auditor, can determine where your greatest opportunities for change exist in your business.

The answers can be surprising, from buildings that are not that old, and yet retain temperature very poorly, to lighting upgrades that can make a big difference, an energy audit looks at the outcome-based changes that will most impact energy expenditures.

Energy Professionals

At Energy Professionals, we have been saving businesses money on their energy expenses for over twenty years.

We are industry experts, who can zero in on the exact changes or upgrades that will make the most rapid, most efficient improvements in your electrical or natural gas energy expenses.

Going green can save you thousands of dollars if done correctly. Contact us for a free energy soft audit to find out how.

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Commercial energy bills are anything but fixed.

We work with our commercial energy customers to ensure they are getting the best products at the best possible rates.

But beyond just the rate for the energy you use, many businesses waste energy…in ways which can be remedied.

Here are several of the most frequent offenders in commercial energy waste.

Air Leaks

While many buildings have been retrofitted with caulking, weather stripping, new insulation, and new windows, air leaks are still one of the most common energy wasters in many facilities.

Where the foundation meets the exterior, the exterior meets the roofing, throughout exterior walls, and especially where there are older windows, buildings such as churches, warehouses, and offices can leak thousands of dollars worth of energy annually.

Air leaks also lead to harder work for the next item…

HVAC

Heating and air conditioning are two of the biggest energy expenditures for commercial facilities of every type.

In addition to better insulation, as described in the section above, advances in technology have dramatically improved HVAC functions, including:

  • Smart thermostats, which adjust for daily occupancy times, seasonal changes, and other important factors.
  • Flexible energy equipment, such as those that can heat with different fuels (depending on market rates), or AC which can run off of solar panels.
  • Heating reuse technology, where heat leaked from appliances or other equipment is used for occupancy heating, or the energy from heating gets redirected into process heating and electrochemical processes (two of the biggest energy guzzlers in many industries).

Trends in heating and cooling suggest that we will see continued advances in these technologies.

Lighting

While many businesses have switched to lower-cost, lower maintenance LED lighting, many others have not, or have in limited application.

Lighting was the 2nd biggest energy expenditure in commercial buildings in the United States just a few short years ago, but thanks to smarter light bulbs and fixtures, those numbers have dramatically improved. Further improvements can be made with lighting occupancy sensors, including dimming features.

Appliances

In some industries, appliance usage is directly tied to cooling and lighting, such as with commercial vending machines.

In nearly every industry, appliance and machinery technologies have improved. Here are some of the key ways to save on appliance and machinery-related energy expenses:

  • Workflow analysis – Use the same equipment at off-peak times, when possible.
  • Equipment upgrades – Many newer appliances are much smarter about energy usage.
  • Auto shut-offs – Just like thermostats and lighting, appliances can get smarter, turning down or off completely when not in usage

Depending on the industry, tax breaks and incentives can help upgrade equipment and reduce energy waste.

Bonus: The Energy You Could Generate

One of the biggest energy wasters is lost potential: the energy that could be generated on site.

For example, a large commercial bakery in Colorado recently turned their rooftop into an onsite power plant by installing solar panels.

Solar panels look better and cost less than ever before, with no upfront costs or paying for themselves in a short period of time, depending on purchasing agreements.

For those commercial properties looking to dramatically reduce energy expenses, onsite energy generation is the way to go.

Get Smart with Energy Professionals

At Energy Professionals, we operate as independent energy brokers for a complete energy management strategy.

Whether you want to reduce energy expenses, target the most effective energy upgrades for your facility, or “go green” with renewable energy resourcing, we have the expertise to get you there.

We offer our commercial energy clients a free energy soft audit, to help determine the most effective strategy to save you thousands, even tens of thousands of dollars, on your energy needs.

Contact us to find out how.

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Winter 2018 Natural Gas Prices Have Exploded Due to Cooler Than Normal November, But Backwardation is Still in Place for 2019 Thru 2022!  

(My reports focus on Natural Gas as it is the largest energy source for the generation of Electricity; therefore, Natural Gas and Electricity are highly correlated.)

In my October 31st Energy Report, I explained why Natural Gas Backwardation over the next 3 years was unsustainable because low prices are a disincentive to increase production, while demand was expected to continue to increase resulting in structural imbalances leading to higher prices in 2019 and beyond.

In my September 19th Energy Report, I warned although prices remained relatively stable since the beginning of the year with supplies at very low levels, it was not wise to become complacent and count on increased production handling demand this winter with supplies at the start of the winter heating season at the lowest level in 10 years.

In today’s report, I will update what has transpired since my last report and discuss how recent price increases have impacted consumers of Natural Gas and Electricity.

As you can see in the chart below, if you did not heed my September 19th warning and have market-based or variable rate pricing, a cooler than normal November triggered an explosive rally and you will be experiencing sharp increases in your Natural Gas and Electricity bills:

After my September 19th Energy Report, Natural Gas prices increased from $2.95 per MMbtu to a high today of $4.93, an increase of approximately 67% in less than 2 months! The recent explosive increases in Natural Gas and Electricity prices have impacted rates in the forward markets through March 2019. Therefore, be very thankful if you already have an energy contract in place, you will avoid this winter’s sharp price increases.

The question is, what was the root cause of the explosive rally? The obvious answer is the rally was due to cooler than normal temperatures in November causing an already dire supply situation to continue to deteriorate and Natural Gas supplies are now projected to remain approximately 700 Bcf below the 5 Yr. Avg. by the end of November! The market is waking up to the reality supplies declined further below the 5 Yr. Avg. based on a cooler than normal November. We are not talking about Polar Vortex temperatures like the winter of 2013/14, we are talking about chilly weather in November!

But what do you think will happen to prices if we do experience a Polar Vortex this winter?

Therefore, it is not surprising as the market came to grips with this reality that Natural Gas and Electricity rates exploded thru March 2019, and you should be very thankful if you have an energy contract in place. But the good news is even if you don’t have a contract or your contract expires in the next few months, prices in the forward markets starting in April 2019 are little changed from the rates shown below in my Oct 31st Energy Report, and the market phenomenon called “Backwardation” still allows you to secure rates far below present levels in the forward market.

As I explained in My Oct 31st Energy Report, the above prices are not sustainable since E&P companies are not profitable when prices average below $3.00 per MMbtu. Therefore, I believe backwardation in the forward markets with prices from Apr 2019 thru Apr 2022 near $2.70 per MMbtu will likely lead to much higher prices in 2019 and beyond!

I believe the dramatic price increases over the last 2 months in winter 2019 prices are a harbinger of a new reality in which structural imbalances in supply/demand will periodically result in explosive price increases and I recommend securing long-term hedgers to protect yourself.

One last point to consider based on the empirical evidence contained in the chart below:

90% of the time over the last 20 years, Natural Gas prices have been higher than $2.70 per MMbtu, and since I believe prices below $3.00 per MMbtu will inevitably lead to structural supply/demand imbalances, and higher prices, I trust you can appreciate the wisdom of securing long-term hedges to protect yourself from the likelihood of higher prices in 2019 and beyond.

Conclusions:

The recent explosive 67% rally in Natural Gas since September 19th was triggered by cooler than normal temperatures in November causing an already dire supply situation to further worsen with supplies now expected to remain 700 Bcf below the 5 Yr. Avg. by the end of November.

The concern is the recent rally was triggered by chilly weather in November, but how high would prices rise if we experience a Polar Vortex this winter! Therefore, given the fact that prices in the forward markets from April 2019 thru Apr 2022 are trading near levels in which over the last 20 years, they have been higher 90% of the time, and prices this low will likely lead to structural supply/demand imbalances, and higher prices in 2019 and beyond, it is wise for anyone with contracts expiring within the next 18-months to secure long-term hedges to protect themselves from the increasing risk of higher prices.

Not every client’s risk tolerance and hedging strategy are the same, but we trust the above report will help you put into perspective the risk/reward opportunities now. I invite you to call one of our energy analysts to help you plan a hedging strategy appropriate for your situation.

 

Ray Franklin
Energy Professionals

Senior Commodity Analyst

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The United States in one of the world’s largest countries, so of course that comes with a wide variety of climates.

In the south, one couldn’t imagine living without air conditioning, but in the midwest home buyers view it as less important than a garage (where you keep your car from freezing).

In some parts of the country, one might rarely use central heat, but for businesses in New England or the midwest, heating might be the most expensive utility, by far.

Since freezing isn’t really an option, here are some ideas for saving money on utilities, while staying warm, all winter.

Get to Know Your Options

The first utility bill after a cold spell often serves as a wakeup call to businesses, and only then do they start taking measures to conserve resources.

You don’t have to wait for sticker shock to get started…you can understand what will occur and prepare, making for a much more pleasant first chilly-weather utility bill experience.

Consider appointing an energy lead or team to get to know your heating needs, and take active measures for improvement. Your energy leader could:

  • Take a look at past usage
  • Examine areas of biggest use
  • Determine possibilities for conserving energy
  • Promote smart energy usage within the workplace

Throughout the year, the conservation team might encourage such activities as turning off computer monitors at the end of the day. In the fall and early winter, though, such a team might focus recommendations on setting thermostats lower at night, limiting the use of space heaters, or other conservation efforts.

Enlist Support

The more your team is engaged in the process of conserving energy, the more buy in you might get.

Examples are limitless, but here are a couple:

  • A church, looking to save on heating expenses, coordinates the use of various spaces and only heats during prearranged occupancy. Lockboxes might even be installed over thermostats, to prevent the extreme, knee-jerk temperature changes that come from last minute occupancy.
  • An office agrees to a game of saving energy. Everyone where sweaters and other warmer clothing, rather than raising the temperature a couple of degrees and running space heaters. To get everyone on board with the game, they came up with a prize: reduce the utility expenses a certain percent and they get a catered lunch that Friday.

How straightforward or creative your conservation efforts go is entirely up to your workplace team and culture, but whatever measures you take you will reduce your energy bill.

Explore Your Options

For a more dramatic cut in heating costs, beyond what wearing sweaters can achieve, consider an energy soft audit.

An energy audit can determine both where your facilities waste the most energy and where you can focus efforts to make the biggest impact.

Thanks to incentives and purchasing options available, it may be possible to make energy upgrades and dramatically slash energy expenses now and for the future. Examples include:

  • Structural upgrades, such as windows or spray foam insulation
  • Utility upgrades, such as heaters, water heaters or appliances
  • Energy generation upgrades, such as the installation of onsite solar panels

While some parts of the country experience shorter, cloudy days throughout the winter, some of the coldest climates have their sunniest days in the winter–such geographic locations are perfect for solar energy solutions.

Energy Professionals

Since the possibilities for saving money while staying warm this summer are limitless, it can be difficult to know where to begin.

That’s where Energy Professionals comes in. As independent energy brokers, we can help you secure the best resources at the best rates for all of your energy needs–from reducing energy needs, to negotiating contract terms, to energy upgrades.

Contact us to find out how you can save money on heating expenses this winter.

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When considering the possibility of generating power onsite with solar power or natural gas generators, many customers are choosing to take advantage of energy buy back agreements.

Read on to find out how these agreements work, and what options might be available for your commercial or residential application.

Connecting to the Grid

The energy utility grid (or “the grid) has to provide the energy supply for everyone in the service area, even if you live in an area with a deregulated energy market (where consumers can choose the brand of the energy supply).

The grid has to provide the infrastructure for the maximum energy used at any time.

This requirement, which helps an area avoid energy brownout or blackout conditions, leads to high energy peak demand charges–the variable rate charge based on the maximum usage of a commercial consumer at any point during the month.

One of the ways that a utility grid can have more available energy, without the expense of building additional power stations, is through energy buy back agreements and interconnection agreements with energy consumers.

An interconnection agreement with the utility still allows you to purchase energy, but also allows the flow of your surplus energy back to the energy grid.

Interconnection with the utility is regulated differently in different states, but the essential similarity is that when you have an interconnection agreement, you can sell surplus energy to the utility.

You can also still purchase needed energy from the utility.

Solar Power Purchase Agreements

In addition to an energy buy back agreement, a term to understand is a power purchase agreement (PPA).

A PPA means that an energy provider will handle all aspects of a project installation–design, permitting, financing, installing and servicing–at little to no cost to the customer.

Then, with those onsite solar panels or other power generation installation, the customer also saves money every month on their utility bill.

So why would an energy provider agree to do such a thing at their own expense?

Under the terms of a PPA, the solar provider will typically receive the income of the electricity sales back to the grid, as well as any tax incentives or other incentives generated by the solar power system.

You get a lower monthly energy bill, they get the utility rewards and income.

Choose Your Own Solar Adventure

Given the options, there are several ways to go about a solar installation, including:

  1. Pay for the equipment, installation and service, but retain tax incentives and other incentives, as well as selling your power back to the utility to generate a power income. This option is very popular for smaller installs, such as for residential application.
  2. Enter into a PPA with an energy provider, and purchase your reduced energy needs from the installer, who will cover the expenses (but also retain the incentives). This option essentially makes you a host site for the energy provider for a contract term length (anywhere from 10 to 25 years). At the end of the term, you have the option to extend the contract, buyout the equipment, or have the installer remove the equipment. This option is very popular, particularly for commercial applications.
  3. Lease through a third-party financing company, the way that one might lease an automobile. You have little-to-no upfront costs, just like a PPA. This is a popular option in both residential and commercial applications.

Any of these options result in lower utility expenses on a residential or commercial energy bill.

Energy Professionals

At Energy Professionals we operate at as independent energy brokers, where our sole mission is to save you money. We work with hundreds of utilities and energy solution providers across the country.

We are the experts in understanding your needs, as well as experts in the opportunities and incentives available in your sector of the energy market.

We will help you understand the contract terms with zero surprises. If there are any out-of-pocket expenses, you will know the exact point of return on your investment.

Our only mission is to save you money on your utility bill.

Contact us to find out how.

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Energy Update

October 31st, 2018

Natural Gas Backwardation is Unsustainable and Will Likely Lead to Much Higher Prices in 2019 and Beyond!  

(My reports focus on Natural Gas as it is the largest energy source for the generation of Electricity; therefore, Natural Gas and Electricity are highly correlated.)

In my Oct 9th Energy update, I said the recent rally of Natural Gas was due to an already dire supply situation continuing to deteriorate with forecasts for colder than normal weather starting in mid-October causing supplies to fall further below the 5 Yr. Avg. by Oct 26th. But the good news was the market phenomenon called “Backwardation”, allowed hedgers to secure rates below present levels in the forward market.

This was especially true when you considered the chart below:

Clearly when you can purchase a commodity near the lower end of its 20-year trading range while supplies are below the 5 Yr. Avg., it is prudent to do so, but this is especially true when a commodity such as Natural Gas has supplies starting its high demand winter heating season at the lowest level in 10 years.

In this report, I will explain why the Natural Gas Backwardation mentioned in my Oct 9th report is unsustainable and will likely lead to much higher prices in 2019 and beyond!

In my trading over the years I have learned commodity prices are primarily based on supply/demand fundamentals, but future estimates of supply/demand often contain false assumptions leading to inaccurate price estimates.  The only explanation for the present Backwardation in Natural Gas prices is the market is assuming growth of supplies in future years will be enough to meet growth in demand. I believe this assumption is flawed for the following reasons:

  1. In 2018, The EIA is estimating Natural Gas will average 82.7 Bcf/d in production, which would be 7.9 Bcf/d more than the 74.8 Bcf/d we averaged in 2017. This would be the largest absolute production growth in history.
  2. The increased production was primarily due to commitments made by Exploration and Production (E&P) companies for new pipelines built to service new shale reserves, but I don’t believe the increased production rate is sustainable.
  3. Growth in E&P is mainly based on the expected price they will receive for Natural Gas. E&P companies are in business to maximize their profits and when prices are expected to be high they increase production, but when prices are expected to be low they decrease production until prices rise again.
  4. As you can see in the chart below Natural Gas prices for the next 3 years are in Backwardation, which means prices are expected to move lower over this period:

It is important to note E&P companies are expected to report negative cash flow this year with the average price below $3 per MMbtu, and with the forward markets forecasting prices will remain below $3 per MMbtu over the next 3 years, E&P companies know they cannot generate profits if prices remain this low; therefore, they will likely reduce their production rates in 2019 to an annualized rate of 2% or less.

  1. In 2018, the increased production of approximately 7.9 Bcf/d was more than offset by increased demand of approximately 9 Bcf/d for the exportation of LNG overseas, new pipelines in Texas increasing exports to Mexico, increased demand for the generation of Electricity to replace Coal power plants closing, and increased demand based on weather extremes.
  2. Obviously weather factors cannot be estimated long-term, but demand is expected to continue to increase with LNG projects coming on line more than doubling LNG capacity to 9 Bcf/d by the end of 2019, and the continued growth in exports to Mexico and use of Natural Gas for the generation of Electricity; all support my belief demand for Natural Gas will continue to increase at a much faster rate than increases in production.

Therefore, based on the above factors, I believe we are at the precipice of major structural imbalances with increases in production not meeting increases in demand, and Natural Gas prices will likely head significantly higher in 2019 and beyond. The only factor that may delay prices moving higher in the near-term would be a mild winter, but this would only exacerbate the structural imbalances as production would remain muted with E&P companies reducing their capital expenditures due to negative cash flow.

Low prices are a disincentive for E&P companies to invest in drilling new rigs and motivates them to shut down operation of unprofitable rigs until pricing increases, and the longer prices stay low now, the longer the structural imbalances will remain in place and the higher prices will likely go later. Therefore, if your hedge contracts expire within the next 18-months, we strongly recommend reserving blocks of Natural Gas and Electricity to be available when your present contracts expire.

Conclusions:

Natural Gas Backwardation over the next 3 years is unsustainable because low prices are a disincentive for E&P companies to increase production, while increased demand caused by LNG projects coming on line more than doubling LNG capacity to 9 Bcf/d by the end of 2019, and the continued growth of Natural Gas exports to Mexico along with switching to Natural Gas from Coal for the generation of Electricity will result in structural imbalances likely leading to much higher prices in 2019 and beyond.

Not every client’s risk tolerance and hedging strategy is the same, but we trust the above report will help you put into perspective the risk/reward opportunities now. I invite you to call one of our energy analysts to help you plan a hedging strategy appropriate for your situation.

 

Ray Franklin
Energy Professionals

Senior Commodity Analyst

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As a church, synagogue, or other place of worship, effective management of resources is vital. Every dollar that you save on your energy bill can go toward your more important, mission-driven programs.

To help you, we offer this guide: 4 key ways that places of worship can save on energy bills.

Get Smart with Energy Usage

Many chapels, churches and other religious facilities use their buildings only at certain key times each week.

One way to save money is to have your energy usage closely mirror your needs.

Occupancy sensors, digital thermostats, motion-activated lights, and other energy regulators can help you maximize energy “down time.”

Particularly in climates with major heating or cooling needs, much of a church utility bill goes toward temperature regulation. With digital regulation and a little planning, you can save money on your utility bill.

Invest in Energy Upgrades

Depending on the age of your facilities, it may have been built before many of today’s advances in energy efficiency.

What’s more, there are many programs that make energy upgrades more accessible to organizations than years past — incentive programs, energy surplus buy-back programs, “savings as a service” programs and many more.

Energy upgrades vary greatly, but examples include:

  • Insulation upgrades – Walls, windows, roofs, and floors may leak significant energy if not up to today’s standards.
  • Lighting upgrades – LED lighting, auto-dimming features, and other lighting upgrades can make a big impact on energy usage.
  • Appliance upgrades – Most religious facilities contain at least a kitchenette, sometimes a heavy-use commercial kitchen. These and other appliances can drain resources, if not efficient in their energy consumption.
  • Heating and cooling upgrades – Not only are HVAC systems more efficient than years past, technologies such as geothermal systems can use the ground temperature to help regulate indoor temperatures.
  • Onsite energy generation – Natural gas generates and solar panels are some of the technologies which can be installed to generate electricity onsite, saving thousands on energy bills, preventing energy blackout/brownout conditions, or even taking a building completely off the grid (particularly when combined with on-site battery storage).

Since houses of worship, in many communities, also operate as emergency shelters, onsite energy generation can make it possible to serve a community even when other facilities lose power.

What’s more, energy upgrades empower a religious facility to take charge of utility bills.

Change How You Pay

Across the nation, the dynamic shifts in the energy business have made it possible for organizations of all types to save money on utility bills.

In many states, energy choice programs make it possible to pay less per kWh. Others offer buy back agreements of on-site energy generation (solar panels connected to the grid) or savings as a service program.

Savings as a service means that the energy provider will provide onsite equipment or energy upgrades at their own cost to help improve energy efficiency. They may get their own tax benefits for doing so, or they may own the equipment but install it onsite, or many other setups that reduce or eliminate the cost of installing energy efficiency upgrades.

Get an Energy Audit

With so many possibilities and unique facilities, the best place for a house of worship to start is with an energy audit.

An energy audit will examine your particular usage, needs, and goals, then help determine the most effective way to reduce your energy expenses.

Whether upgrading your facility, changing energy providers, or negotiating rates for an upgrade installation, at Energy Professionals we work all day to save you the most money on your energy expenses.

Even reducing your energy bill by 20-30% can save you thousands of dollars, over time.

Contact us to request a free energy soft audit today.

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The retail industry is vital to the whole of the United States economy.  An estimated two-thirds of the US gross domestic product (GDP) comes from retail sales.

“Retail, directly and indirectly, supports 42 million jobs, provides $1.6 trillion in labor income and contributes $2.6 trillion annually to U.S. GDP.” (Select USA).

But operating a retail business can also have high overhead.

When it comes to energy expenses, there’s a pretty good chance that a retail business is paying too much.  In fact, the US Environmental Protection Agency (EPA) has identified energy savings potential of up to 41% for retail stores (up to 21% for supermarkets) with effective energy management.

Retailers spend an estimated $20 billion on energy expenses each year!

One of the key ways a retailer may save is through energy upgrades.

Here are some of the key points to know to pay the lowest possible amount for energy in the retail sector.

Save Tens of Thousands

Energy upgrades may save a business thousands, even tens of thousands per year.

Considering that about 95% of the retail industry is privately or independently owned, you may not know what choice you have in dealing with a public utility.  It is not uncommon for a business to assume that a utility bill is just fixed, by various unknown factors, and a business may not have much say in rates, much less in such “add-ons” as energy upgrades.

Yet your retail business does have a choice!

One of the biggest ways to save is through energy upgrades–and there are many ways those upgrades can cost you little-to-nothing.  Energy upgrades may pay for themselves through such possibilities as:

  • Tax incentives or credits,
  • Amortization,
  • Surplus energy credits,
  • Buy-back agreements to the local utility,
  • Financing options which extend payments to closely match ROI rates,
  • And more!

Given the many options available, it is possible to know the exact timeline for ROI (return on investment) for any upgrade that may include an out-of-pocket expense.

In some cases, upgrades end up costing nothing directly to the retailer!

Upgrades Available to Retailers

Energy upgrades available to retailers vary widely depending on your location, facility specifics, and type, as well as many other factors.

Some of the biggest ways in which retailers can upgrade to save on utility bills include:

  • Structural changes such as roofing, insulation, or solar directing (using solar direction to heat in colder climates, or redirecting sunlight for improved cooling in warmer climates);
  • Appliance upgrades for more efficient refrigeration or other appliance needs;
  • Lighting upgrades, such as LED lighting, motion-activated lighting or reduced off-hours lighting;
  • Smart thermostats, thermal energy storage (TES), and other heating or cooling upgrades;
  • Timing changes to adjust peak usage expenses;
  • Onsite energy storage (batteries) or energy generation (natural gas generators, solar panels, etc).

With so many options available, retailers have the power to reduce or even eliminate their utility bill, by getting partially or fully off the utility grid.

Where to Start

With so many options available to retailers, and so many differing outside factors (such as geographic location or building lease/ownership agreements), it can be difficult for a retail business to even know where to begin to find commercial energy savings.

Fortunately, at Energy Professionals our sole mission is to save our energy partners money while helping you achieve your sustainability goals.

We know how to dig into the nitty-gritty, such as billing accuracy, but also how to effectively engage in long-range planning, such as setting and achieving energy independence objectives.

Let us work with you, through a free energy audit, to independently evaluate the potential savings and upgrades for your retail energy bill.

Contact us today to get started!

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Choose Your Energy Supplier

Energy Professionals is committed to finding its customers the best possible rates on electricity and natural gas. Tell us your location and service type and our energy supply partners will provide you the most competitive offers.

Switching to an alternate supplier is easy. There is no chance of service disruption, and you'll continue with your current utility for energy delivery and emergency service. Take a few minutes to discover your best offers, and enjoy the benefits of retail energy in your home or business.

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