I love buying things on eBay. It’s that thrill of the auction as those last seconds tick down and getting the product that I really wanted at a great price.
What if I told you that you can buy your gas and electricity commodity in an auction format as well? But instead of the price going higher like it does on eBay, the price goes down. It’s what we call a reverse auction.
In this week’s Two-Minute Tuesday, we’re going to talk about what a reverse auction is for energy buying, if you’re a good fit, and what the benefits could be to your business as a result.
What is a reverse auction?
So what is a reverse auction? Just like we talked about, it’s like eBay in reverse. Instead of the price going higher for your electric or natural gas price, the price is actually going down as more bidders compete.
Take your current supplier or third party, like a Constellation or a Direct Energy. They all compete in an open platform online live for 20-30 minutes submitting multiple bids to win your business.
What are the benefits of a reverse auction?
The benefits to you are transparency in the process and a lower overall energy rate.
Am I a good fit for a reverse auction?
To find out if you’re a good fit for this, you may consider:
Do you need complete transparency in your purchasing or procurement process?
Are you a public entity where you want to see everything on a fair, open platform?
Or, are you a large business where energy is a large spend for you and you need the absolute lowest rate possible in the marketplace?
If so, this may be a route you want to consider.
So how about a real-life example?
We just ran a reverse auction for electricity for a large local school district a few months ago. Their overall rate at the end of the auction resulted in savings of $600,000 for their school district.
Think about how that kind of money and savings could help your operating budget. Then, reach out to your current broker or consultant and see if this is something that they offer. See what it could look like for your business and the savings you could attain as a result.
Thanks for watching our video! Leave your comments below, and check out this article on how you could benefit from a reverse auction.
https://naniaenergy.com/wp-content/uploads/2019/12/TMT-Becky.jpg6001200AJ Brockmanhttps://naniaenergy.com/wp-content/uploads/2017/03/logo-300x138.pngAJ Brockman2019-12-10 20:06:162019-12-10 20:06:16Two-Minute Tuesday: Reverse Auction for Energy