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Now is a Great Time to Hold up the Mirror to Your Retail Energy Spend

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Although energy is one of the largest non-people costs for businesses and institutions, it is often considered a noncontrollable expense and receives less ongoing attention than it deserves. Viewing this expense through a new lens that brings greater transparency can lead to meaningful near-term savings opportunities that do not affect your core business.  CFR has recently found significant cost savings opportunities, specifically for retail power and natural gas supply.  In today’s economic environment, where every dollar countssavings can help fund sustainability opportunities and other important initiatives 

CFR’s Wholesale and Retail Energy Services team has uncovered attractive opportunities in recent work supporting corporate and institutional clients:  

Significant savings on natural gas procurements are possible

  • CFR is seeing ~15% over the next 3-4 years
  • One CFR client achieved ~$1.2M of total cost savings over contracts signed in 2018

Similar savings on retail power contracts – particularly on older contracts 

  • CFR is seeing ~15% savings over the next 3-4 years – total savings driven by volume size
  • Contracts signed prior to 2018: expect ~20% or more savings – value increases the further back you go (e.g. contracts starting in 2017 or 2016) as those were typically closed in higher price environments

Taking a fresh look is key – 2x-4x savings possible relative to renewal with incumbent broker/supplier 

  • Leveraging the competitive marketplace is a key success factor 
  • Recent competitive process run by CFR quadrupled the client’s savings as compared to what they would have realized by renewing with incumbent supplier

The approach should be tailored to client needs and market conditions 

  • Natural gas in forward year prices have been inching up over the past 3-4 weeks, which impacts both future power and gas procurement prices  
  • Short-term commodity price pressure is driving down production; as supply gets reigned in for future years, prices could start rising as demand and supply moves more towards an equilibrium 
  • Increased volatility in natural gas prices over next 1-2 years with near-term market uncertainty  

Now is a good time to kick the tires, regardless of when current contracts expire  

  • Savings can be captured on near-term expiring contracts as well as forward starts – regardless of when the contracts expire, forward power and gas curves suggest immediate review and action where possible.  

If you are interested in learning more and having CFR diagnose savings opportunities at no cost, please contact David Rissmiller, Vice President, Wholesale & Retail Energy at  

(240) 449-3013
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