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73% of Small Businesses Want Fixed-Price Electricity Supply Contracts

July 8, 2014 By Linda Hardesty

The most commonly selected type of electricity supply contract is one with a fixed price, according to survey results from the Energy Research Council (ERC), which is a consortium of energy suppliers, including APPI Energy, ConEdison Solutions, Constellation and Direct Energy.

In 2013, ERC surveyed about 1,300 executives from small-to-medium sized businesses (SMBs) and found that 73 percent of SMB executives are most interested in locking in a fixed-price electricity supply contract.

The ERC’s research brief, “Are fixed-price electricity supply contracts really fixed?” says when comparing fixed-price offers from many competitive electricity suppliers, the critical goal is to ensure that each fixed-price quote includes the same electricity supply components, such as adders, capacity costs, ancillary charges, gross receipt tax, and sales and use tax. Also, review each supplier’s contract conditions, looking for clearly defined assignability, bandwidth clauses, change-in-law provisions, early termination fees, and expiration procedures. All of these conditions can add unanticipated costs to customers’ monthly bills, impacting total costs and limiting customer options.

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