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Energy Solutions: Natural Gas Buying Advisors
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Frequently Asked Questions

Energy Solutions, Inc. provides a variety of natural gas and electricity consulting services to businesses that are considering the purchase of their energy or are already purchasing their energy from a third party supplier, and not their local utility.

 

Below are a number of frequently asked questions regarding Energy Solutions, Inc.  Perhaps if you have a question about our company, you may be able to find your answer right here.  However, if you have a question that isn't covered below, please feel free to give us a call at (608) 848-6255 so that we can make sure your question gets answered.  
 

General Questions

1.   Does Energy Solutions only serve certain-sized customers?
2.   What types of businesses look to Energy Solutions for assistance?

3.   I just don't understand what Energy Solutions does? 

 

Natural Gas Buying Questions

4.   What is a proactive buying plan?

5.   Are price stability and proactive buying the same thing?

6.   Will a proactive buying plan guarantee the lowest price? 

7.   How does Energy Solutions pinpoint a buying opportunity in its proactive buying plans? 

8.   Are Energy Solutions' buying recommendations applied unilaterally? 


Questions on our publication, The Advisor

9.   What does Energy Solutions' publication offer?

10. How does Energy Solutions' publication, The Advisor, differ from my marketer's newsletter?

Questions on our Consulting Services

11. What do Energy Solutions' buying advisory or consulting services offer?

12. How does Energy Solutions develop a proactive buying strategy with its consulting clients? 

13. Does working with Energy Solutions impact my contract with my marketer?

14. What if my marketer is hesitant to work with Energy Solutions?

15. Is Energy Solutions' plan better than my marketer's plan?

 

Questions on how Energy Solutions compares to Natural Gas Marketers

16. How does Energy Solutions differ from the services provided by my natural gas marketer? 

17. Do I really need a natural gas buying advisor?  

18. Is the buying advice from my marketer sufficient? 

19. What guarantees does Energy Solutions offer?

 

 

 


General Questions 

 

1.  Does Energy Solutions only serve certain-sized customers? 
     Energy Solutions works for businesses of all sizes.

 

We cater to the business end user – large and small.  The buying advice and information that we provide is written and communicated in an easy-to-understand format.  We understand that buying natural gas is most likely not your only responsibility, so we have a developed line of publications and several reports that quickly identify anticipated buying direction and actions to be taken – either by you directly or in the case of consulting, the actions that Energy Solutions would like to take on your behalf.  We have clients that are new to the natural gas industry and others that have been involved in it for a number of years.  However, subscribers to our publication and our consulting clients all have one thing in common -- they want to take control of their natural gas expenditures. 

 

2.  What types of businesses look to Energy Solutions for assistance?  
     Those that want assistance with price stability.

 

Many types of businesses and industries look to Energy Solutions for either our publications or our tailored buying advisory services.  Our client base includes both manufacturing companies as well as service companies, such as hospitals.  It's really quite simple – we provide buying advisory services to businesses that want advice and assistance in taking control of their natural gas expenditures to protect their bottom line.   

 

3.  I just don't understand what Energy Solutions does? 
     We help businesses determined when and how much natural gas to buy into the future.

 

Natural gas is a cost item that impacts a business' bottom line.  The primary challenge for businesses is the fact that this cost item can fluctuate dramatically, cutting into their profits or impacting their budget.  Energy Solutions uses a number of tools to evaluate the natural gas market and price conditions.  By using those tools, we provide businesses with an "outlook" for prices.  But, in addition to an "outlook," we provide businesses with specific buying recommendations on when to buy their natural gas through a proactive buying plan.  In today's deregulated marketplace, businesses have two choices:  (1) They can simply accept the price of natural gas and its day-to-day price fluctuations or (2) They can become proactive and get involved in making decisions about when and how much natural  gas to buy into the future at a set price.  Our role is to assist those businesses that decide to take choice #2 by providing insight into their decision-making process.




Natural Gas Buying Questions

4.  What is a proactive buying plan? 
     A buying strategy that protects a business' bottom line.

 

A proactive buying plan is what Energy Solutions refers to as a tailored natural gas buying strategy.  It is a plan under which businesses purchase their natural gas supplies into the future through the use of the New York Mercantile Exchange (NYMEX).  A proactive buying plan should include articulated goals, and the plan should be modified accordingly when those goals aren't attainable.  A proactive buying plan avoids price surprises and provides a business with bottom line protection. 

 

5. Are price stability and proactive buying the same thing? 
    No.

 

A company can achieve price stability by simply choosing a point in time to secure the price of their natural gas supplies into the future.  The question is what is the "right" point in time.  Energy Solutions believes that price stability at reasonable and supportable price levels is achieved through a proactive buying plan.  A well-designed proactive buying strategy will look for buying opportunities and when those surface, that becomes the "right" point in time to secure a fixed price.  Businesses want price stability – but they want it at competitive price levels and at prices levels that will protect them from budget overruns.  Readers of The Advisor are able to implement their own proactive buying plan based on buying recommendations and notification of the "right" time to buy.  Similarly, consulting clients receive one-on-one advice and guidance on the implementation of a proactive buying plan. 

 

6.  Will a proactive buying plan guarantee the lowest price? 
     Not Always.

 

No one has a crystal ball, therefore no one can guarantee the lowest price.  Natural gas prices are  impacted by outside factors like Mother Nature and speculative trading.  Relative to Mother Nature, the mild temperatures of the winter of 2011-2012 caused natural gas prices to plummet.  However, when Mother Nature unleashes her wrath as with Hurricane Katrina, natural gas prices can skyrocket.  Natural gas prices can exhibit very erratic behavior simply because of  a surge of speculative buying or selling of contracts on the New York Mercantile Exchange (NYMEX).  The underlying concept of a proactive buying plan is to secure the price of your natural gas supplies in advance at reasonable and competitive price levels so that your business' bottom line is protected from the whims of Mother Nature and the unpredictable impact of speculative trading.

7.  How does Energy Solutions pinpoint a buying opportunity in its proactive buying plans? 
     Through fundamental and technical data.

 

Fundamental data examines issues like supply and demand, weather, and storage inventories.  Technical data examines pricing patterns, seasonality, trading volumes on the NYMEX and more.  We believe that while fundamental data may set the stage for natural gas price momentum, technical data is helpful in determining the length and duration of price declines and price rallies.  There is more information on how buying decisions are made as well as fundamental and technical analysis under the category Additional Insight.

 

8.  Are Energy Solutions' buying recommendations applied unilaterally? 
     Yes and No.

 

In The Advisor, our buying recommendations identify buying actions to take based on the level of risk that the reader wants to assume.  So the reader must evaluate the buying recommendations and take action accordingly.  For some businesses, a dramatic increase in the price of natural gas means a cut into their bottom line or profit margin.  For others, natural gas price fluctuations make it more challenging to price their product as a component of their product's cost is directly tied to the cost of natural gas or energy to produce it.  Some clients want to have the price secured on the majority of their natural gas supplies six months into the future, while others are willing to accept a little more risk.  Each client has a risk level it will or will not accept.  For our consulting clients, Energy Solutions is aware of the varying levels of needs and goals of each client.  As a result, our buying recommendations will take into consideration the individual requirements of a customer, their specific needs or buying criteria, the geographic location of a client, alternative price options available, and the risk tolerance that a client has chosen.  In essence, we work with each client individually and make buying recommendations accordingly to insure that the needs of that individual are met while at the same time insuring that an accurate balance of price stability and risk tolerance is maintained.


 




Questions on our publication, The Advisor

 

9. What does Energy Solutions' publication offer? 
    Articulated buying recommendations and more. 

 

Energy Solutions publishes The Advisor, which provides readers with timely information on natural gas market conditions and anticipated price direction.  The goal of The Advisor is to assist readers in the development and implementation of a proactive natural gas buying plan.  We sort through market data and summarize it in clear, concise articles.  A subscription to The Advisor provides readers with 12 monthly editions, 48 weekly updates, 12 editions of Fast Facts, plus an e-mail Alert service, which means that when natural gas prices make an unexpected move that wasn't outlined in the weekly or monthly editions; we'll notify you via e-mail of the situation so that you can decide if you need to take action.  In addition, during the summer, you'll receive Hurricane Alerts if there is any sort of tropical storm that could ultimately threaten prices.  Overall, The Advisor is your independent resource for natural gas buying decisions.  Click here for additional information on the benefits of The Advisor.

 

10. How does Energy Solutions publication, The Advisor, differ from my marketer's newsletter? 
     Our advice is independent and we periodically evaluate the performance of our buying recommendations.
 
 

Many natural gas marketers publish newsletters that are free to their customers.  The information contained in these newsletters varies greatly.  Free information is great if it provides you with the value you are seeking.  The value of 'free' newsletters differ -- some are easy to read, and others are filled with jargon and charts.  Energy Solutions' The Advisor is not free, but it is certainly reasonably priced.  Basically, you the reader need to compare the value received from your 'free' information to the value delivered in The Advisor, which is less than the cost of 150 dekatherms or 1,500 therms of natural gas. 

 



Questions on our Consulting Services

 
11. What do Energy Solutions' buying advisory or consulting services offer? 
     Tailored buying recommendations and more.

 

Our consulting or buying advisory services are tailored to meet a company's individual needs.  We work with you to develop a proactive natural gas buying plan that is customized to make sure your goals are met.  We communicate and interact directly with you.  Basically, we watch the market, so you don't have to!  We monitor and analyze the market each day, and we directly communicate to you when it appears to be an appropriate time to consider securing or fixing the price on your natural gas supplies.  While we may offer similar buying recommendations in The Advisor, those recommendations must be implemented by the reader.

 

12. How exactly does Energy Solutions develop a tailored proactive buying strategy for a client?  
     We work together.

 

While we may know the natural gas market, you know your business and any specific requirements, so in order to have an effective proactive buying strategy, we work together.  We work with you to learn about the goals you want to achieve, the level of risk you are willing to assume, and the impact of meeting your budgetary needs.  Then, we develop and fine-tune a proactive buying strategy that is customized to fit your particular needs.  We make sure that your customized strategy is implemented to protect your bottom line and the goals set are achieved!

 

13. Does working with Energy Solutions impact my contract with my supplier (marketer)? 
      No.

 

Energy Solutions works with your natural gas supplier.  The contractual arrangement between the supplier or marketer and the business identifies the reliability of how natural gas will be delivered and how the commodity will be priced.  The "unknown" is how the commodity is priced.  If the price of the natural gas commodity isn't secured or fixed into the future, it is typically priced based on current market conditions, which can dramatically impact a business' bottom line.  It's important to emphasize that we work for you, and this means we work with your natural gas marketer as well.  When natural gas buying recommendations from Energy Solutions are approved by a consulting client, they are  implemented with your natural gas marketer and we review all confirmations for accuracy to insure the fixed price purchase is completed at the right price level.

 

14. What if my marketer is hesitant to work with Energy Solutions? 
     If they are, that would be a first for us.

 

Energy Solutions has never encountered this situation because we are not a competitor to the natural gas marketer.  On behalf of its clients Energy Solutions successfully works with more than 40 natural gas marketers throughout the nation.

 

15. Is Energy Solutions' plan better than my marketer's plan? 
     It depends on what you're looking for.

 

Some natural gas marketers offer natural gas buying plans, but others do not.  While we can't speak to each type of buying plan, some natural gas marketer buying plans involve the purchase of a percentage of natural gas needs over a set period of time.  Price levels for this purchase may be established based on historical price levels or simply based on a specific date on which to make the purchase each month.  These types of plans serve to balance or average out natural gas expenditures over a period of time, but don't necessarily take advantage of timeframes where Energy Solutions may identify the existence of a significant buying opportunity.  It is also important to evaluate a natural gas buying plan by a marketer to insure there is a contingency plan if buying targets aren't hit.  Another difference that customers need to discuss with their natural gas marketer is the communication process during times of dramatic price fluctuations.  Remember the marketer, as the supplier, has certain responsibilities related to the delivery of the commodity of natural gas, and contractually that could take precedence over communication on prices.  At Energy Solutions our number one focus is communication on natural gas prices.  We alert our clients to buying opportunities and provide clients with articulated recommendations.  However, we also warn clients of situations that may result in a modification of the buying plan strategy.

 



Questions on how Energy Solutions compares to Natural Gas Marketers

 

16. How does Energy Solutions differ from the services provided by my natural gas marketer?  
     Energy Solutions is an "advisor" of prices, and is neither a seller nor buyer of natural gas.

 

While natural gas marketers and Energy Solutions both monitor the natural gas market for buying opportunities, there is one significant difference.  The natural gas marketer or supplier is the seller of the commodity, which means the marketer is actively buying and selling the physical commodity of natural gas. The primary role of the natural gas marketer is to deliver the commodity of natural gas. Energy Solutions is not a supplier or buyer.  Instead, the primary role of Energy Solutions is to provide unbiased natural gas buying advice and clearly articulated natural gas buying recommendations.  For our consulting clients, a secondary role that we play is to continually monitor the performance and the competitiveness of the natural gas marketer. 

 

17. Do I really need a natural gas buying advisor?  
     It simply depends on how comfortable you are with your current buying plan.

 

The natural gas industry has become increasingly complex.  Price moves are more significant and more rapid than they were even three years ago.  For companies that choose to make buying decisions internally, we recommend that (1) you insure you have an adequate amount of time to monitor the market; (2) you document why you've made certain buying decisions and/or why you opted to postpone buying decisions; and (3) you make certain that your decisions have the support of others within your company.  Few will question buying decisions when prices are falling, but when prices spiral out of control as they did during Hurricane Katrina, knowing that your decisions are supported is critical.  We take the worrying out of the above three listed items.

 

18. Is the buying advice from my marketer sufficient? 
     You have to be the judge of that.

 

Some natural gas marketers and their representatives actively provide natural gas buying advice.  Others have moved away from providing buying advice because the wrong advice could mean the loss of a customer's business.  Therefore, when relying upon natural gas buying advice from your marketer, it is recommended to clarify whether buying advice is the position of your individual marketing representative or if the advice is supported by the marketing company itself.  In the end it comes down to what you are looking for, but when it comes to natural gas buying advice, it is important to make sure that buying advice that you receive (1) can be relied upon; (2) is consistent and timely; (3) can be expected on an ongoing basis; (4) is understandable and supportable; (5) is periodically evaluated for performance; and (6) takes into consideration your goals and budgetary needs.  Again, you have to be the judge of whether or not you feel you are getting the information you need.  If you're just not sure, consider taking a FREE trial to The Advisor.  It is great way to get to know the services of Energy Solutions a little better.

 

19. What guarantees does Energy Solutions offer? 
      Peace of mind at competitive price levels.

 

We'd love to say we can guarantee you a savings of 10%-20% percent, but the fact is we can't control all of the factors in the marketplace that move prices up and down.  In 2008, the commodity price of natural gas has traded as high as $15.78 per MMBtu.  Conversely, in 2012, it traded below $3 per MMBtu for much of the year.  For most businesses, the cost of the commodity accounts for about 60%-85% of a business' total natural gas expenditures.  While we can't guarantee specific savings, subscribers and consulting clients who have implemented our buying recommendations find that on average their monthly price will be in the lower one-third of where that monthly price of natural gas has moved over the past year.  We can't guarantee the lowest price, but we're proud to say that our buying recommendations help businesses secure a natural gas supply that is priced at the lower end of the trading range.  Plus, when it comes to our consulting clients' tailored buying plans, close attention is paid to the business' budget to insure that profitability is protected.