Progressive Electricity Purchasing Management

Progressive Electricity Purchasing Management

Optimise your energy buying to lower long term costs and manage risk

With changing market conditions and significant price volatility, discerning energy users are purchasing their electricity progressively to lower their long-term costs and reduce price risk exposure.

Enel X guides you through the progressive purchasing process, leveraging our team of energy and finance experts, and sophisticated technology.

This method allows you to take advantage of lower energy prices in the market as they arise, avoid renewing a contract when pricing is high, spread the risk of purchasing your electricity at one time, adjust exposure to the market and achieve lower costs.

Our tailored approach

With daily market monitoring, we present information that empowers you to make robust energy decisions aligned to your organisations strategic goals and risk profile. We advise when to lock in pricing based on live market information evaluated against current market conditions and historical trends. By using triggers, we can ensure a maximum spend is not breached if the market moves against you, maintaining budget certainty.

Our full service offering includes:

We assess the market and recommend the best progressive purchasing product that aligns with your business goals. We consider advantageous product attributes and appropriate retailer margins and premiums.

We set up a governance framework that reflects your risk tolerance. It provides the ability to opportunistically lock-in good prices, whilst ensuring budget certainty and pre-agreed maximum price thresholds. This includes:

  • Assisting with the setup of a risk committee (if needed)
  • Assisting in developing a risk policy that outlines exposure limits, budgeting timeframes and maximum spends, along with reporting parameters
  • A Value at Risk (VaR) methodology which is applied to your portfolio’s usage profile into the future, to fully visualise and manage price risk and exposure levels
  • Transaction recommendations supported by data analytics and risk policy parameters
  • Interacting and transacting with your retailer when necessary, to action price lock-ins
  • Assistance in developing budgets, capital at risk lines (maximum spend) and baselines
  • Monthly management meetings to discuss market context and advance strategy

We proactively manage the product on your behalf following the VaR methodology. We report on your daily electricity position, and your position for the following three calendar or financial years, ensuring robust risk management.

We monitor your position against price fluctuations in the market and produce a daily VaR report. The report recommends buying decisions based on factors including: VaR, quarters trading below historic average and structural market moves.

Our flexible service models

We offer both a full service model and a risk management software platform subscription, depending on your business needs.

Full service

This model as outlined above is for businesses requiring support from our energy purchasing experts. With the full service model, the Enel X team provides:

  • Development (or review existing) risk management framework
  • Development (or review existing) trigger strategy
  • Liaison with your supplier to transact the buys/lock ins (once approval has been given)
  • Monthly meetings to discuss market and ongoing buying strategy
  • All elements of our Platform subscription

Platform subscription

For businesses that are comfortable with the progressive mechanism and have robust risk policies in place.  Our platform: 

  • Takes away all the heavy lifting, from calculating the portfolio’s day to day live position, to alerts when bespoke limits or market movements occur. 
  • Provides all reporting needs, including the expected commodity spend to the dollar, and performance charts showing your purchases. 
  • Customisable automated trigger alerts will inform you of specific changing market conditions.

Learn more about our risk management platform here

 

Service models Full service
Platform subscription
Setup and user overview
Live reporting
Automated trigger alerts
Downloadable PDF reports
Development of Risk Management Framework -
Development of Trigger Strategy -
Transacting on your behalf -
Monthly meetings -
Platform licenses 6 3

 

To learn more, get in touch with one of our energy experts today.

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