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Energy Market Update: March 21, 2018

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How can you combat peak summer energy demand?

In this week’s Energy Market Update, Direct Energy Business Strategist, Tim Bigler, introduces a new procurement strategy, Fixed Energy Plus™, and explains how it can help you save money.

Watch the video below to learn more.


Summer electricity prices

Peak summer electricity demand can lead to high prices per megawatt hour.

  • ERCOT North experienced flat prices in September 2017, but those prices have sharply climbed since due to retirements.
  • NYISO prices were near $50 in early 2017, but have dropped down some since then.
  • ISO NE and PJM ComEd prices are starting to climb for the summer.

What is Demand Response?

If there is a heat wave during the summer, Direct Energy Business can help. Load Management programs known as Demand Response pay participants to reduce their usage during times of peak demand across the system.

Our team can help you forecast when those peak days will occur and prepare a curtailment plan for your organization. You’ll get the benefit of a new revenue stream, plus the opportunity to potentially manage your peak load contributions.

Introducing Fixed Energy Plus™

Direct Energy Business has launched a new program for large commercial and industrial organizations in PJM and ISO NE markets called Fixed Energy Plus. The procurement solution reduces customers’ exposure to price volatility by passing through demand-based charges, including capacity and transmission. Customers will also receive peak load notifications, enabling them to manage consumption on forecasted peak load days.

In other words, with Fixed Energy Plus, you get the pricing structure and market intelligence to maximize demand-based efficiencies. That means if summer energy prices rise, you are exposed to less risk and can act quickly to manage costs and reduce your overall bill.

Importance of Capacity and Transmission

But how can you reduce your overall bill if you’ve already locked in energy supply?

That’s where Fixed Energy Plus is unique – and it’s why capacity and transmission can be very important in managing the overall cost of your energy. Direct Energy Business can’t control these pass-through charges, but they can make up 25-40 percent of your bill – a big change from 10 years ago when they made up just 10-15 percent.

Capacity and transmission are calculated based on your peak load contribution. So, you can minimize these costs by reducing the multiplier: your demand. Programs like Demand Response and pricing structures like Fixed Energy Plus are designed to help you do just that.

Stay tuned to the Direct Energy Business Blog for the latest energy market news and information

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Posted: March 21, 2018