Sep 13, 2017 | Trends, Industry

Energy and the Small Business: What To Know

In 2009, when Albireo began its mission to build a better and more scalable energy platform, we were in a very different place in the energy markets. Electric deregulation has just begun in the Northeast and customers were confused by electric choice and unsure whether there was value in leaving the utility rates. Why do you start w 2009 and then go to 2008 after? Were “we” in a different place or was the market/ or customers??

Some customers were overwhelmed by choice and many had legitimate concerns. Would they actually save money? Would the utility punish them if they left? How did they know what supplier to choose? How do they compare one price to another? How do I know if a broker is knowledgeable and experienced? These were some of the many questions we received from small businesses.

In 2008, Albireo received a call from the office of Mayor Menino from the City of Boston, inquiring whether we were interested in attending a focus group on energy pricing in Boston. The late Mayor was concerned that the Main Street businesses were getting killed by electric pricing and there was no apparent way for the City to help. He wanted to pull in industry leaders to determine if there was a solvable problem and what role the City could play in helping the small business community.

Albireo was presented with a wonderful opportunity to take its premise of scalable platforms and efficient data analysis to the next level. We were able to demonstrate how a citywide program could provide opportunity for those small businesses , which would otherwise be ignored in the marketplace. We knew that the other participants would claim that buying from them was the solution, but Albireo went into the meeting with another vision, – bulk purchasing. We proposed that the businesses of Boston should buy together and compete the marketplace at every chance. This method would produce the best results time and time again. It would not lock the businesses into a specific supplier but involve them in a competitive process.

At the conclusion of the City’s vetting process, Boston Buying Power was formed. Since its inception, Albireo has worked with over 4000 local Boston commercial accounts to save them energy dollars and provide budget certainty.

Approaching ten years later, the value statement has not changed and the results remain significant. Boston Buying Power customers are still coming onboard with 10-25% savings versus what they would have obtained individually in the market. They have also been given the opportunity to enter into Renew Boston to have the city partner in energy efficiency project, BERDO compliance to report energy usage, and solar projects. Other cities like Philadelphia have organized similar programs, as have private groups like major QSR franchises and property management companies.

We observe small businesses facing the same struggles today as they did at our inception. Many are getting bad deals or are not taking advantage of energy market opportunities. Some people have a cousin or “know a guy”, selling energy, but those people may not have market expertise or experience. Others have been working with the same broker or supplier for years but don’t know if they are getting actual value. Others just haven’t changed because they have no interest or time to figure it all out.

We understand it is difficult to make intelligent energy decisions while running your business. However, every business owner knows it is cheaper to buy in bulk. If you buy together with similar businesses and vigorously compete in the marketplace, you will be getting a better deal than buying solo and by chance. There are quality buying groups out there, including ones in the small commercial sectors. Wouldn’t those saving opportunities be helpful to your bottom line?

Over the past ten years, we have worked with tens of thousands of accounts and the bottom line Change this – we used bottom line above in different context always comes down to how much effort needs to be spent to get a result. With group purchasing, the benefits have far outweighed the effort and just make sure you are synergistic with the group I think this should be deleted as there was nothing about synergism in the article; or add a paragraph about how we aggregate. We hope that you will explore electric choice and we are confident that you will find Albireo’s buying power programs to be a valuable option.

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