FAQ'S
How do I begin to lower my energy costs?
A. Contact Forward Energy Group and speak to one of our professional energy advisors who will discuss and evaluate your business needs, as well as identify opportunities to manage and reduce electric costs.
How do I benefit in using Forward Energy Group's services?
A. We prepare executive budget analyses related to energy costs, consumption data, and market trends. Assistance is also provided for bill auditing and reviewing of transmission and distribution data for any anomalies. We provide constant tracking of energy pricing and recommend the optimal period to secure your energy rate. We provide a complete and detailed analysis of competitive pricing with no hidden costs.
How do Aggregators, Brokers and Consultants in the energy business get paid?
Since the Electric Reliability Council of Texas (ERCOT) became fully deregulated on January 1, 2002, there are now different options for a consumer of energy to purchase electricity from a Retail Electric Provider (REP). The www.powertochoose.org website provides a list of REPs available to a consumer for purchasing energy. Basically, there are two primary options to select from in purchasing energy from a REP. The first option is to purchase the energy on your own and take all of the risks and responsibility in selecting the best product, price, proper contract Terms & Conditions, and a reputable REP who fits your energy load profile. The second option is to hire an Aggregator, Broker, or Consultant (ABCs). Forward Energy Group is an ABC, but prefers to be identified as an Energy Advisor and a full service resource to its clients. Most importantly, Forward Energy Group discloses upfront its service fee to its clients.
If the consumer opts to use an ABC resource with knowledge about the energy industry to aid in purchasing energy, then the ABC is responsible for selecting a REP who will be serving the consumer’s power meters. These power meters are identified by a unique Electric Service Identifier (also known as ESI ID). In most cases, the ABC will collect a service fee through the REP who won the consumer’s business. The REP will either pay the ABC upfront for the term of the contract or pay out on a monthly basis. In either case, the cost is embedded in the consumer’s price per kWh under the commodity only portion of the monthly energy billing statement. If this payment arrangement is not accepted by the consumer, then the ABC can collect the service fee directly from the consumer. In this case, the consumer knows exactly the cash amount that is being paid to the ABC for the services delivered. It is worth noting that under no circumstance will an ABC work for FREE.
The service fee structure is usually charged in increments of $0.001/kWh (also known as a mil). For example, if the consumer’s annual kWh usage is 1,000,000, then the annual service fee for the ABC is calculated as 1,000,000 times $0.001 per kWh for a dollar amount equal to $1,000. Again, this service fee can be paid upfront by the REP or paid monthly at about $83 per month, depending on the actual usage registered by the metering device.
Forward Energy Group’s standard service fee is charged on a sliding scale based on the complexity of the account and the annual kWh consumption rate (our typical fee is set at $0.001 per kWh). The fee will change for larger or smaller energy loads or for those requiring a premium level of service. We have heard of fees being paid as high as 2 cents (20 mils) per kilowatt hour.
Thus, it is important to be cautious when selecting an energy advisor; a consumer must trust an energy advisor as it would its own physician, legal counsel or CPA. The energy advisor must have a consumer’s best interest at heart. The following are a few ways in which an ABC can take advantage of a consumer:
1. Not disclose the fee paid by the REP and charge whatever they believe a consumer of energy will pay;
2. Tell the consumer one fee and have the REP include a larger fee;
3. The ABC will likely want the consumer to extend an energy contract as long as possible, even if it’s not in the best interest of the consumer. This allows the ABC to “lock in” business income for the future.
A consumer of energy can protect itself from these abuses by asking the winning REP to provide in writing (on REP letterhead) a statement of how much the REP is paying the ABC. Furthermore, ask an ABC for its referral list and call the referrals and inquire on the level of satisfaction provided. Do your homework; review the background of the individual you are communicating with. Work with well-known reputable ABCs and REPs; avoid ABCs that seem aggressive or offer something that seems unreasonable. Demand to deal directly with one of the principals of the business; often, the experienced or senior principal of the ABC group will win your business and then hand you off to a customer service group with less experience and knowledge.
To summarize, once a consumer of energy becomes a client of an ABC, the following services are what a client should expect from an ABC. The ABC a client chooses to do business with should be knowledgeable about the relationship of different energy resources on the price of electricity. The ABC should confirm (by reviewing the client’s energy contract) the actual dates the various ESI IDs on contract will expire. The ABC should then follow through and track the switch through the winning REP and the ERCOT portal. The ABC should review the first bill to assure the client is being billed at the proper rate. The ABC should review all Transmission Distribution Service Provider (TDSP) usage records and charges for the past 12 months and search for errors. The TDSP is the regulated electric service provider formerly the “electric utility” for the area in which a client’s facilities are located (Oncor, WTU, CPL, CenterPoint and Texas New Mexico Power). The ABC should provide a price matrix to the client of all the competitive bids submitted by the REPs. On a long-term basis, the ABC should be the “single point of contact” for all client energy needs. The ABC should advise the client about reducing energy consumption in its operations, as well as, provide advice about demand side management incentives available with TDSPs and other government programs. The ABC should continuously monitor the market and advise the client when an opportunity exists to improve its situation.
How much are you paying an ABC and are you getting your money’s worth?