Client Successes
National Wireless Telecommunications Carrier
Issue: Rapid expansion leaves no time to manage energy
This national wireless telecommunications carrier was rapidly expanding service into new markets. As its reach stretched across new states, energy supply contracts were quickly established to support what would eventually become an operational footprint of more than 4,000 locations. The result was a fragmented, costly network of energy suppliers.
Yet company resources were focused on living up to its brand promise for thousands of new customers. They needed a partner they could trust to quickly develop and implement a plan to reduce energy costs.
Solution: Establish trust quickly and create a strategy to optimize energy costs across thousands of locations
As we’ve done with many clients, we came up to speed quickly on the company’s operations, establishing trust with procurement managers eager to get a handle on energy costs of the growing company. We reviewed energy consumption needs across multiple regions, including the impact of regulatory issues affecting energy costs. From our load analysis we developed a comprehensive energy strategy that made use of competitive supply markets, and actionable plans to improve the cost structure of locations that fell outside of competitive markets.
Our strategy reduced the operator’s energy supply costs by 28 percent, dollars it was able to plow back into operations to remain a formidable competitor.
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Solution: Establish trust quickly and create a strategy to optimize energy costs across thousands of locations
As we’ve done with many clients, we came up to speed quickly on the company’s operations, establishing trust with procurement managers eager to get a handle on energy costs of the growing company. We reviewed energy consumption needs across multiple regions, including the impact of regulatory issues affecting energy costs. From our load analysis we developed a comprehensive energy strategy that made use of competitive supply markets, and actionable plans to improve the cost structure of locations that fell outside of competitive markets.
Our strategy reduced the operator’s energy supply costs by 28 percent, dollars it was able to plow back into operations to remain a formidable competitor.
Interstate Products Pipeline
Issue: Lack of a proactive strategy exposes company to the volatility of energy markets
This company has 800 locations connected by a sophisticated web of pipeline that crisscrosses more than a dozen states. They purchased energy when contracts expired, leaving them vulnerable to the unforgiving volatility of energy markets. Without an energy procurement strategy, this company had no measures or framework to know when, how or why to purchase energy.
This isn’t uncommon. In fact, we see it often. As with other clients in this situation, we knew the pipeline company’s opportunity cost – what it could potentially save – was sizable.
Solution: Establish risk management policies that improve budgeting and reduce costs
Educating our clients on how to proactively manage energy supply is something we enjoy and that we do well. We worked closely with this company’s procurement team to teach them about energy management, including the value of hedging. They learned how hedging portions of their energy supply two, three or four years out could help them manage the company’s exposure to volatile energy markets providing predictability, consistent planning and forecasting.
Shifting from education to action, we created risk management policies and models based on the company’s risk tolerance. With the models we built for them, they gained a reliable, structured process to help them decide when and why to purchase energy.
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Solution: Establish risk management policies that improve budgeting and reduce costs
Educating our clients on how to proactively manage energy supply is something we enjoy and that we do well. We worked closely with this company’s procurement team to teach them about energy management, including the value of hedging. They learned how hedging portions of their energy supply two, three or four years out could help them manage the company’s exposure to volatile energy markets providing predictability, consistent planning and forecasting.
Shifting from education to action, we created risk management policies and models based on the company’s risk tolerance. With the models we built for them, they gained a reliable, structured process to help them decide when and why to purchase energy.
National Equipment Manufacturer
Issue: Disappointing experience with another energy management firm prompts company to go it alone
Having tried another energy management firm, this company determined to manage its own energy procurement. Working on their own, though, they eventually found themselves in a precarious position.
The company entered a period of extreme market volatility with none of the company’s electricity or natural gas supply protected through hedged contracts. Faced with knee-buckling increases in energy costs, they knew something had to be done and reached out to Sable Power & Gas for guidance.
Solution: Create a plan to manage costs downward
Shocked by the blow of skyrocketing prices, our client wanted out of their contracts quickly. But we advised them that this wasn’t the best solution. Instead, we mapped out a path forward. The plan called for the manufacturer to shift its mix of energy supply products in a way that reduced their costs over time.
Within the next two years as they transitioned to new energy supply products, not only did their energy costs change significantly – decreasing by 69 percent – so did their view on energy management. They learned that a planned, methodical approach to energy management based on how much risk they were willing to carry provided them a measure of control over energy costs they didn’t realize was possible.
Many companies extend trust to energy management consultants, only to pull the work back inside when they receive less-than-expected counsel and results. It happens time and again. This client learned that our managed approach to energy supply is far and away different than others.
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Solution: Create a plan to manage costs downward
Shocked by the blow of skyrocketing prices, our client wanted out of their contracts quickly. But we advised them that this wasn’t the best solution. Instead, we mapped out a path forward. The plan called for the manufacturer to shift its mix of energy supply products in a way that reduced their costs over time.
Within the next two years as they transitioned to new energy supply products, not only did their energy costs change significantly – decreasing by 69 percent – so did their view on energy management. They learned that a planned, methodical approach to energy management based on how much risk they were willing to carry provided them a measure of control over energy costs they didn’t realize was possible.
Many companies extend trust to energy management consultants, only to pull the work back inside when they receive less-than-expected counsel and results. It happens time and again. This client learned that our managed approach to energy supply is far and away different than others.
Metal Recycling Company
Issue: Unpredictable energy consumption narrows options for reducing energy costs
Energy is a significant line item for this client. As with any metal recycling operation, the company consumes a much higher percentage of energy compared with companies in other industries. On top of that, its energy consumption is unpredictable. How much energy it requires depends entirely on the amount of metal that comes through their doors on any given day or week. This client needed to lower operational costs and asked us to help.
Solution: Change shift schedules to pull energy at off-peak hours
We often recommend hedging to moderate the costs of energy for our clients. But locking in a price requires a commitment to purchase a certain amount of energy. Clearly this company’s unpredictable consumption meant that hedging wasn’t an option.
With traditional energy management tools out of reach, we developed an unorthodox energy strategy for our client. We had analyzed when and how the recycler used energy over the course of a typical week, charting the energy consumption in 15-minute increments. We realized that while the recycler couldn’t adjust how much energy it required to operate, it could adjust the hours it operated.
We recommended slight changes to shift times so that the recycler could draw energy at off-peak hours at lower costs. Average annual energy cost savings: 30 percent.
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Solution: Change shift schedules to pull energy at off-peak hours
We often recommend hedging to moderate the costs of energy for our clients. But locking in a price requires a commitment to purchase a certain amount of energy. Clearly this company’s unpredictable consumption meant that hedging wasn’t an option.
With traditional energy management tools out of reach, we developed an unorthodox energy strategy for our client. We had analyzed when and how the recycler used energy over the course of a typical week, charting the energy consumption in 15-minute increments. We realized that while the recycler couldn’t adjust how much energy it required to operate, it could adjust the hours it operated.
We recommended slight changes to shift times so that the recycler could draw energy at off-peak hours at lower costs. Average annual energy cost savings: 30 percent.
Private Restaurant Chain
Issue: Locking into a contract at the height of a price cycle
This successful restaurant chain was one year into a three-year contract when they reached out to us. Energy represented the third highest cost for the company, which owns and operates six busy restaurants. They’d locked into the contract under the advice that prices would likely continue to rise.
Skilled at negotiating favorable terms for goods and services, the team had secured a fair price at the time. But when energy prices moderated over the coming months – leaving them with the higher rates – the operations team realized they needed a better approach going forward.
Solution: Create a plan with triggers for when and why to purchase energy
Our client was locked into a contract with unfavorable terms. The primary – or only – decision-making tool they’d used to enter into that contract had been an immediate need: they needed energy then and they bought it then.
Having determined that breaking the contract wasn’t an advisable course of action, we worked with them to build a plan with a long-term focus. The plan called for purchasing energy in one-, three- or six-month increments based on what the markets did. That is, rather than allowing the market to dictate how much the restaurant paid for energy, the plan spelled out triggers – movements in the market – that informed buying decisions.
Our client was pleased with the results of the new managed approached to energy procurement. And why not? Their costs came down 65 percent, from $123 MWh to $41 MWh.
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Solution: Create a plan with triggers for when and why to purchase energy
Our client was locked into a contract with unfavorable terms. The primary – or only – decision-making tool they’d used to enter into that contract had been an immediate need: they needed energy then and they bought it then.
Having determined that breaking the contract wasn’t an advisable course of action, we worked with them to build a plan with a long-term focus. The plan called for purchasing energy in one-, three- or six-month increments based on what the markets did. That is, rather than allowing the market to dictate how much the restaurant paid for energy, the plan spelled out triggers – movements in the market – that informed buying decisions.
Our client was pleased with the results of the new managed approached to energy procurement. And why not? Their costs came down 65 percent, from $123 MWh to $41 MWh.
Nonprofit Organization
Issue: The need to be good stewards of donated dollars
Our client is a large nonprofit organization. Naturally it had different challenges and restrictions for procuring energy than our for-profit clients.
The organization placed a high premium on protecting every dollar gained through grants or charitable donations, so risk would have to be used judiciously. At the same time, it sought to reduce operating expenses so that it could direct as many dollars toward fulfilling its purpose as possible.
Solution: Create a structured 36-month rolling energy management strategy
In the end, we needed to develop an energy management strategy that assured annual budget certainty – meaning a low-risk strategy – while also seeking the best possible price. We created a strategy that provided pricing stability 36 months out. This gave the organization ample time to secure additional funding to cover significant price fluctuations.
- Click to view our solution
Solution: Create a structured 36-month rolling energy management strategy
In the end, we needed to develop an energy management strategy that assured annual budget certainty – meaning a low-risk strategy – while also seeking the best possible price. We created a strategy that provided pricing stability 36 months out. This gave the organization ample time to secure additional funding to cover significant price fluctuations.