Commercial real estate energy efficiency is an essential part of running and maintaining your property. You have many expenses to manage, so you should save money where you can, including how much you’re spending on your building’s energy needs.
Many real estate property owners think energy prices are out of their control. But did you know, depending on your location, you can have a say in how much you spend on your property’s energy? Take charge of your expenses for potentially lower monthly payments and more room in your budget. Learn how energy procurement for commercial real estate can benefit you below.
Commercial real estate energy procurement involves the process of obtaining the electricity or fuel you need to power your building’s operations. You can procure your fuel from a retail supplier or a utility company. All that matters is you’re sourcing your fuel from a supplier and using it to meet your commercial building’s demands.
The question is, what options are available to you as a commercial real estate property owner? In recent years, many states have started reversing energy buying and selling restrictions. Businesses can then get their energy from private retailers instead of a single, state-issued energy supplier. Now you have an option in where you get your energy from, leading to more control over how much you’re paying on your monthly energy bills.
Competitive markets open the door to competition between suppliers, which can result in lower prices for businesses and commercial properties — the entities that buy and consume the fuel. If your commercial property exists in an energy-deregulated state, you have the option to procure your energy in a way that works for you.
You have options when it comes to energy procurement. Think of this task as you would shopping for any other product or service. You need it, and the companies have it. It’s a matter of finding the one that suits your needs, and the power is in your hands to find the right one.
Making an informed decision comes down to two factors. The first is knowing the various roles involved in the process. The second is understanding the different types of contracts available.
Here are the four main entities involved with energy procurement for commercial real estate:
The types of contracts available from suppliers are where you’ll start to see real savings in the energy procurement process. Here are some of the contracts you can choose from:
As the owner of commercial property in a deregulated state, you should develop an energy procurement plan. Some property owners see energy as an untouchable expense they have to deal with until the end of time. Thanks to deregulation, you can enjoy lower prices and have flexibility with where you get your energy from. With an energy procurement plan, you can start the process of obtaining your energy in a way that benefits your business.
Approach formulating your energy procurement plan as more than a way to be a responsible energy shopper. View it as a way to give you an advantage over your competition. If you rent your commercial property to small businesses, they’re going to want to enjoy more affordable energy prices, as well. You can attract tenants by offering the best energy prices in the area, keeping your space filled and active.
This consideration can reduce your overhead and open your budget for other matters involved with owning a commercial real estate property. You’ll have a game plan so you know where to look, what questions to ask, and how to make sure you’re getting the best value for your energy. With an energy procurement plan, you’ll know the kind of energy prices you need to operate your commercial property as efficiently as possible. You’ll save money, but you’ll also be able to experience many more benefits as a result.
Let’s take a closer look at some of the other benefits you can enjoy by implementing an energy procurement plan for your commercial property.
Owning a commercial property is a big responsibility. You have to keep it in good shape so it can be useful in your community. From repairs to inspections, there’s a lot to focus on to meet regulation requirements. Knowing you’re paying the best price possible for energy is one less thing you have to worry about as you maintain your property.
You’ll feel good knowing where your energy is coming from — and having a say in the matter. By staying in touch with your supplier and utility company, you’ll know how much you’re paying at all times. You’ll even know when your utility company will deliver your energy, helping you reduce risks and downtime.
For some commercial property owners, more freedom from regulations is one of the best gifts they can receive. Regulations are important for safety and quality of life, but they ultimately limit your choices. If you care about having the freedom of choice in where you get your energy, then implementing an energy procurement plan is the way for you.
You’ll get to call the shots with where you get your energy from and what contract you sign up for. Instead of hearing about price changes and paying the difference, you can stay ahead of the curve and choose the type of budgeting option that works for your situation. With energy procurement, you get to be proactive and make plans based on your own preferences.
Take the complexity out of dealing with energy suppliers and utility companies with an energy procurement plan for your commercial property. You’ll be able to consolidate your vendors so you know where to get your essential energy documents, receive billing information, and even lobby questions and concerns.
You’ll have a set amount of billing and delivery options to simplify the process even further. Many energy suppliers even offer a digital system to track your transactions and energy usage. And when you deal with the same account manager month after month, they get to know you and simplify the process even more.
You now know how a procurement plan can help you with commercial real estate energy management. Here are five factors that can help make sure your procurement plan is successful.
Every commercial property is different. You should assess your needs to help you make the right decision about where you get your energy from and what type of contract you choose. Review your usage reports and see how much you’re paying across your current vendors. Then set a goal to reduce the number of vendors you’re working with. Choose an energy supplier that can provide you with several of your energy needs.
You should also decide how much risk you’re willing to take. If a firm budget matters most to you, you may seek a fixed contract. If you have more room in your budget to take risks in the hopes of higher financial returns, you may want to take your chances with a variable contract. Different contracts will work for various commercial properties, so assess your needs and risk tolerance to build the best situation for you.
Go into your energy procurement plan with the right mindset. You should know what you want to get out of your plan and how you’re going to get there. Understand your goals to help you better achieve them and experience the benefits of energy choice.
Shipley Energy can help you manage this step in the process. Talk through your needs with us so we can better help you understand what kinds of contracts and pricing will work for you. By outlining your goals and needs, you’ll be better equipped to make a smart decision for your commercial property’s energy solution.
Be confident and ask questions when you begin contacting energy suppliers. Companies that answer your questions with openness and honesty are ones you can trust, but be wary of the companies that seem to dodge your questions. Here are some of the questions you should ask energy suppliers as you narrow down your search for the right one:
Make sure you spend time shopping around to get a full picture of the options available to you. An energy broker could be helpful in this step, but even without one, you can take some time to make sure you’re covering the necessary ground.
Check your current energy contract to remind yourself of the termination date and start forming a severance plan. In the meantime, start negotiating with other energy suppliers. See which ones are willing to fight for you to be their customer. The suppliers willing to go above and beyond for you are the ones that should be on your shortlist.
You need a partner in your energy procurement strategy. Look for a company that knows what they’re doing — one that’s been in the business for a long time. Consider Shipley Energy, a supplier who has been in energy for over 90 years, as your energy procurement solution.
Having a team of people to help you find the best energy solution for your commercial real estate property is essential. You may wonder how you ever managed your energy before such a partnership. Shipley Energy can change the way you think about energy procurement, making the whole process easier.
If you’re ready to take the next step toward energy autonomy, then Shipley Energy is the company for you. Our dedicated, professional team is ready to help you find a contract that suits your business needs. As a commercial property owner in a deregulated state, you deserve the best price for energy possible. Our goal is to help you achieve that.