Unique Challenges for Hospitals
The management of energy for hospitals typically falls to a CFO, or a “Building and Grounds/Facilities” department. Having the proper expertise to adequately understand the highly complex energy commodity market, along with all of the industry specific contract language, deal structures, and processes pose a significant challenge to staff that is already spread thin with managing all of the other operations of the facility.
With hospitals, much of your electricity usage comes from HVAC. Keeping a comfortable environment for the building occupants, as well as reliability of service is always a high priority. On the surface, it may seem that there is not much flexibility to reduce consumption or optimize your usage.
The sheer volume of energy consumed by hospitals can pose a significant challenge to properly managing your accounts. Even very small changes to your energy rate can be significantly magnified on the bottom line of a financial statement.
Due to the large energy use, the lure of special and non-typical contract structures offered by energy suppliers can, on the surface, seem like a good thing. The problem is that many of these contract structures offer a lower rate at the expense of shifting market risk to you through many hidden and non-apparent ways. This risk can far outweigh any benefit you think you are getting in your upfront pricing.
In the hospital sector, there are many “Group Buying” sales initiatives offered by various companies. In most cases, these may seem like attractive options, but energy commodities are quite different than other items that hospitals ARE used to buying through group initiatives. In all cases, these group buy initiatives for hospitals are simply a marketing gimmick that often put the electricity or gas procurement process in the hands of companies that are more experienced at buying goods and services, rather than a complicated and volatile energy commodity. This can cost the hospital money.
With energy commodities, there are very good times to transact in the market cycle, and very bad times to transact. Simply transacting when your existing contract is nearly over puts your business at risk, because the market may be at a very bad entry point, causing you to lock in at inflated prices.
How We Can Help
- We provide a single point of contact that gives you access to our entire team of energy professionals. We make sure NOTHING is missed, and we make sure everything is done according to “Best Practices” for the industry.
- Our staff is heavily weighted toward technical professionals, such as engineers and quantitative analysts. This is especially important for hospitals. We are uniquely qualified to do the analysis necessary to make sure that you are not taking on unnecessary or unexpected market risk.
- We have experience in understanding where opportunities exist with heavy HVAC loads, often times providing unique solutions to generate savings and/or revenue for hospitals.
- We are available for onsite meetings, as necessary, to support our recommendations and provide insight into the energy markets.
- We provide market updates and recommendations as to exactly WHEN your next contract should be signed, so that you can maximize your savings.