Three Common Mistakes That Can Doom an Energy Procurement Contract Before the Ink Has Dried

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As more companies turn to energy advisors to negotiate attractive long-term electric and gas contracts, problems can arise when businesses hire the wrong or ill-prepared energy advisors and wind up with less-than-favorable contracts.

More companies are turning to energy advisors in today’s unpredictable energy market to negotiate attractive and stable long-term electric and gas contracts. However, problems arise, industry expert Nick Papamichael of Green Crown Energy warned, when businesses hire the wrong or ill-prepared energy advisors and wind up with less-than-favorable contracts even before the ink has dried.

According to Papamicheal, a sought-after speaker on the topic of electric and gas energy procurement contracts, there are three major mistakes that some companies, and the so-called energy consultants they employ, make that can doom an energy procurement contract.

The first, he said, is purchasing energy at the wrong time of the year. “It would seem fundamental that an energy advisor would know when to buy energy or stay on the sidelines, but we find that’s often not the case,” Papamichael says. “There are very specific times of the year when electrical and natural prices retreat and times when they spike. At Green Crown Energy, our energy advisors take full advantage of any historical dips in the market on behalf of our clients and purchase the commodity at the most advantagious time of year."

"The second mistake that too many businesses make when it comes to energy procurement contracts is not negotiating the terms and conditions, including bandwidth, termination, and ancillary costs,” Papamichael asserted. “While energy advisors are not attorneys, the good ones have seen enough energy contracts to make suggestions and identify any possible pitfalls," he explained. "At Green Crown Energy, we have successfully negotiated terms and conditions with the ESCOs (energy services companies) on numerous occasions that would have gone unnoticed by our clients. That is why making sure you’ve hired the right energy advisor is the first step in keeping electric and gas outlays down."

The third mistake, Papamichael pointed out, is not properly identifying and selecting the right energy product, which can result in huge losses. “Every client has different needs," he said. "There are a myriad of hybrid products available today — far too many to expect a client to be well-versed in. Again, that’s why it’s vital to choose the right energy advisory company in the first place. At Green Crown Energy, we are experts at matching up the right product for each of our clients.”

"The bottom line is that the energy procurement contract a company signed a few years ago may be a woefully bad deal today," Papamichael said. “I always recommend that a company do a careful background check on any energy consulting company it authorizes to negotiate gas and electric contracts," he noted. "For example, ask if they are licensed and whether they’re active in the energy industry. What type of experts does it have on staff? Are they invited to speak and participate in panel discussions at industry events and trade shows? And most importantly, ask them."

Papamichael suggested that "by asking a few questions of their energy advisors, a company can avoid these three common mistakes and secure electric and gas contracts that not only lock in the lowest possible rates for years, but allow a company to more accurately forecast its energy outlay.”

For more information about how you can lower your company’s energy bills, or for a free consultation, go to or call 877-308-2727.

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Paul Errigo
Greencrown Energy
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