February 2023 Volume 5

OPERATIONS & MANAGEMENT

Upping Your Energy Game: Transparent Energy Partnership with FIA Delivers Member Savings By Jane Seagraves

Last year around this time, the Forging Industry Association asked me to write an article about how online energy procurement – namely purchasing your energy load through an online auction run by Transparent Energy – increases competition for your energy contract while driving down the resulting price of your natural gas, electricity, or renewable-energy purchase. Ever since, we have enjoyed a close partnership with FIA and its many members. In this article, I will be spotlighting some FIA member success stories from the past year that underscore the strategic advantages delivered by online auction-driven energy procurement. But before I get into those details, let’s take a moment to look at what happened over the past year in terms of energy prices. In my inaugural article, I discussed how something occurred in 2021 that had not happened in years: prices went up – dramatically . The multi-year lows in energy prices, bottoming out during the Pandemic, resulted in record low natural gas prices of under $2.00/ Dth in the summer of 2020. One year later, prices had nearly tripled. Then, by the end of summer 2022, we were dealing with natural gas

prices above $9.00/Dth. (Note: remember, because more electricity than ever is produced by natural-gas burning power plants, natural gas and electricity prices are tightly linked.) In a nutshell, this is the very definition of market volatility . I mention this, because energy market volatility necessitates a more proactive, process- and technology-driven approach to buying energy, one the forging industry, and more broadly the entire U.S. manufacturing sector, hadn’t really had to worry about for years. That has changed. With the cost of energy being a major operating expense for forging companies, sole-sourcing energy from the local utility or working with a local broker with limited supplier relationships and no technological or process expertise can spell disaster for your business. Also, because energy markets remain highly volatile – for reference, they are quite low today as I write – it is imperative that you partner with us now so that we can help you be ready to go to market at the drop of a hat, i.e., when market conditions are most favorable to you. Waiting to work with us until your energy contract is about

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