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Commercial Energy Contract Renewal

Auto Renewal and Holdover Rate VS Market Energy Supply Rate


Do you know what happens when your current energy supply rate (electricity and/or natural gas) contract expires? Don’t worry, most don’t know. But you should know!  Because missing the renewal deadline could prove to be very costly to you and your business.

Contract auto renewal language is most often found in small commercial and residential electricity and natural gas supply contracts. Basically the competitive supplier has language in the supply contract that gives the supplier the right to auto renew, or evergreen your contract. Only if you don’t act before the expiration date of the current contract that is. The renewal price typically is not the most favorable rate in the market. This auto renew clause could possibly negate any savings you had realized.

More often though, commercial energy supplier contracts would stipulate that as your contract expires, you roll into a “holdover” rate. The holdover rate typically is a supply rate  that bares no resemblance to the prevailing competitive market rate. As long as you know when your contract expires, the holdover rate shouldn’t be an issue, as you can call EA, and we will help you “shop” for a competitive supply renewal contract.

Lastly, when your energy supply rate contract expires, some suppliers will kick you back to your utility’s POLAR (Provider of Last Resort) rate, which might also be a bad place to be. Often utility energy supply rates are short term (think monthly adjustable) and higher than prevailing market rates.

Let us know if you need help understanding your supply contract renewal options. We will show one simple hack to make sure you never miss a renewal opportunity.  Contact Us Today!

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