Memories of last year’s frigid winter and its high energy bills could be your wake-up call to think about buying natural gas from an alternative natural gas supplier.
The Energy Alliance Group of Michigan has experts ready to help you determine if this option will save you money on your natural gas bills. “We do all the legwork for our potential clients,” says Jeff Eccleton, an independent agent for Volunteer Energy, an alternative gas supplier company.
An alternative gas supplier, licensed by the state, is able to buy natural gas on the open market and “sell” it back to your current natural gas utility company, to be delivered to your business or home often at a lower price for you.
“For each client, commercial or residential, we calculate the average 12-month usage, and look at what you’re paying the utility company for natural gas (most often Consumers Energy or DTE) and see if we can do better,” says Eccleton. “We work hard to find rate plans that are a good value to the customer.”
Here’s an example of how this is working for one of EAG’s client’s, Ground Effects Ltd., which customizes new vehicles for auto dealers. Recently, Ground Effects entered into a two-year fixed rate contract for natural gas at three of its Michigan facilities, in Warren, Flint and Dearborn. This contract is projected to save Ground Effects an average of about 5 percent on its cost of natural gas.
“This is just another example of how we take a comprehensive approach in reducing our clients’ energy costs,” says Scott Ringlein, founder of EAG of Michigan. “Although lighting and HVAC are the low-hanging fruit for energy savings, we go much deeper and look for all the nickels and dimes we might save for our clients!”
Delivery of the natural gas, the reading of the meter, service of gas lines and billing are still handled by your current utility company. A gas supplier simply procures the gas on your behalf and makes it available for delivery to you via your local utility company.
Volunteer Energy offers three rate plan options: Variable Rate Plan, with the rate varying each month as the market changes; Rate Protection Plan, with a fixed price for a period of time, protecting clients from market fluctuations; and a Guaranteed Savings Plan, which is guaranteed to be lower than the utility company, with smaller but certain savings.
“In this area, especially after last winter, it makes sense to lock in a rate before winter actually begins. Businesses (and residential customers) are able to get the price now and we’ll guarantee it through the winter,” Eccleton says.
“The natural gas market is volatile, with prices sometimes changing every 15 minutes. It’s based on supply and demand. If you set a fixed rate during a time of year when there are lower demands for natural gas, you can avoid increases when the demand rises,” he says.
Last winter, with excessive usage because of the cold weather, prices tripled and, if that happens again, a contract for a fixed price could help level that out for users of natural gas.
“We know how much natural gas we used in our homes, but just imagine what some of the major manufacturing companies had to use last winter. Some of those commercial or industrial bills were astronomical,” Eccleton adds.
Once a business enrolls with a gas choice provider, their agent stays with the account and is available to the client.
Savings are possible with the gas choice program because providers are able to watch the fluctuations in natural gas pricing and buy when prices are lower. Large utilities, regulated by the Michigan Public Service Commission, often have to buy 18 months out to ensure they will have enough natural gas for customers.
To learn more about Michigan’s Natural Gas Choice program, visit this Michigan Public Service Commission site.
If you would like to get a quote from EAG and see if your business (or home) qualifies for a lower rate, click here.