LakePoint Energy offers many different products to meet your energy needs.  Energy procurement decisions can be costly if not properly executed.  Energy prices are constantly changing directly affecting your energy costs and budgets.  LakePoint Energy specializes in purchasing energy on behalf of companies.  Our team will assist you in understanding and choosing the right energy product to ensure the best pricing strategy for you facility.

Two common solutions for managing overall natural gas cost include Fixed Price and Index Price.

Your business’ budget priorities and ability to manage the quantity of electricity used can help determine the right energy supply program.

Product Benefits Risk Profile
Fixed
  • Budget Certainty
  • Sheild from market volatilty
  • Highly suitable for most commercial and industrial companies.
  • Customer must take delivery of power needs at a certain price rate.
  • Terms 1 to 7 years.
Low
Index
  • Industrial companies that can shed load, manage power consumption.
  • Pass on the cost of electricity to their customers.
  • Majority of usage during off-peak hours.
  • Time of high energy prices.
  • Short term flexibility.
High
Other
  • Play the market w/ option to lock at later time.
  • Bear risk of index price to take advantage of dips in a fixed contract price.
  • Ideal for growing businesses.
Medium

 

Fixed Product

Fixed price solutions give businesses the ability to secure a set price-per-kWh during a designated contract term. Fixed price is a common buying option for businesses seeking budget certainty. The certainty comes with a cost, called a variable load cost, which reflects the variable risk the energy provider must take on by offering a fixed price over a period of time.

Fixed price solutions are easy and protect businesses from market volatility, but they do not offer the flexibility to benefit from reduced costs in declining markets. There is also a timing risk: you may lock into a price that seems low for the moment, but that price can seem high just days or weeks later if the electricity market drops even further.

Fixed pricing delivers cost stability and protection from high prices.  Customer pays a fixed price for an agreed-upon volume of energy no matter the price changes in the commodity market.  Fixed pricing is ideal for customers looking for budget certainty and minimal risk. This is the best electricity option for a business that doesn’t have the time or resources needed to stay on top of changing market prices.  Standard Fixed Price Product Lock in your price up front for the budget certainty and risk mitigation your business needs.

Index Product

With the index price option, businesses pay the varying market price of electricity for each given hour. This hourly fluctuation provides businesses with the flexibility to adjust their usage to take advantage of market dips.

Since the customer is basically absorbing all the risk that the price will fluctuate, there is no variable load cost associated with this option. This hourly fluctuation can make it difficult for some businesses to accurately manage their cost as it relates to the quantity that needs to be consumed for that particular hour.

However, businesses can take advantage of price volatility to competitively plan and manage the quantity of electricity they consume based on anticipated hourly prices. Manufacturers, for example, can opt to use more electricity at off-peak hours (overnight).

For experienced shoppers with the flexibility to shift usage, monitor energy markets daily, and take advantage of lower off-peak market prices.  Business electricity products based on real-time market prices. Electricity price changes occur on an hourly basis.

Benefit − Tailor plan for a changing market, and follow price volatility before converting to fixed electricity price.

Extra Info – Typically half of electric budget is spent during the summer months

 

Other Products

There are many other products that can be designed specifically to each clients needs, including both fixed price and variable price components.  Here are some different types of products available.

Index with Fixed Price Trigger

  • Play the market w/ option to lock at later time.
  • Bear risk of index price to take advantage of dips in a fixed contract price.
  • Moderate degree of risk.

Heat Rate

  • Pay market-based prices and power indexes not available in market.
  • Desirable when gas prices are expected to decline.
  • Suitable for companies having a strong commodities hedging function.

Fixed Price Block with remainder at index

  • Some Risk
  • Reduce price while mitigating risk of variable pricing.
  • Ideal for growing businesses.
  • Lock a fixed price for a portion of load and pay index for the remaining.

Block & Index

  • A fixed price block of power covering base load requirements.
  • The block is specified in advance, therefore the percent or fixed versus variable changes month-to-month as your load fluctuates.

Percent of Load

  • The customer can determine an exact percent of load that will be fixed, maintaining the exact percent as load fluctuates month-to-month.