energy-procurement

Fixed pricing locks a rate for 12-36 months and suits organizations needing budget certainty, while index pricing tracks wholesale markets at lower average cost but with full spike exposure. Most C&I buyers hedge 60-80% fixed and leave 20-40% on index based on variance tolerance.

Analyze 15-minute interval data to find peak-setting intervals, then shift discretionary loads off-peak, enroll in demand response programs, or deploy battery storage for peak shaving. Stacked value from demand charges, capacity tags, and TOU arbitrage typically yields 5-7 year battery paybacks.

A physical PPA delivers actual power from a renewable generator to your load within the same ISO, while a virtual PPA is a financial contract-for-differences settling against wholesale market prices. VPPAs require treasury approval and mark-to-market accounting but work across geographies.

No. Fixed-price supply contracts cover only the energy component; transmission, distribution, and rider charges flow through from the utility. A rate case can add $0.005-$0.015/kWh to delivered cost regardless of your supply contract.

A ratchet clause sets your minimum billed demand at 60-80% of your highest peak from the prior 11 months. One accidental spike, such as simultaneous equipment startup, can lock in elevated billing demand for a full year.

Avoid unhedged index exposure during winter in ERCOT, where extreme weather events like Winter Storm Uri pushed wholesale prices to $9,000/MWh. Use price caps, put options, or fixed blocks before high-risk seasons.