Energy Advisors – The Definitive Guide to Selection
Energy Advisors – The Definitive Guide to Selection
Energy Advisors – Before you hire one, this guide will help you avoid costly mistakes when selecting and contracting a partner.
Energy Advisors - Guide to Selection
Energy Advisors or Consultants are everywhere and companies have thousands to chose from, so how do you tell the good, from the bad and the just plain ugly? In this definitive guide, we provide no-holds-barred advice on selecting a strong partner for your business and how to avoid costly contract mistakes.
In writing this guide, Vervantis assumes that you have already found a shortlist of energy advisors who have the experience, skills, technology, coverage, and service levels that your company is seeking. Still, perhaps you are not quite sure how best to make the final selection and protect yourself from corrupt practice.
Ask yourself these seven questions:
- Do I know how much commission energy suppliers will pay the advisor?
- Will the energy advisor warrant that this is all the compensation they receive from the energy supplier and that no costs will be inflated or adjusted to give a pseudo commission?
- Will the energy advisor use their power with suppliers to stop them from speaking to me directly?
- Can I still speak directly to my energy suppliers without the advisor there?
- Am I restricted from talking to other energy advisors or suppliers if the agreement with the energy advisor has a notice period?
- When operating a wholesale priced flexible contract (i.e., block & Index), does the advisor ensure I get the correct market price without any commission?
- Does the agreement with the energy advisor restrict me from sharing data with other parties? It’s your data, make sure you are free to access and use it as you wish.
Once you have reflected on the services and done the checks above, its time to change the status quo. Even if you like the advisor and want to work with them, you do need to improve the level of transparency as it is good corporate governance.
When negotiating your advisor agreement, ask for the following provisions to be inserted:
- The Energy Advisor shall warrant that all tender analysis shall transparently show how much money is being paid by suppliers to the advisor.
- The Energy Advisor shall warrant that all quotations received shall be provided this information.
- The Energy Advisor shall warrant that the supplier shall not receive any other money.
- The Energy Advisor shall warrant that if the supplier gives money for any other purpose, this payment, which could create a conflict of interest, is revealed to me.
- The Energy Advisor shall warrant not to restrict me from speaking to any other Energy Advisors for the life of my agreement.
- The Energy Advisor shall warrant not to restrict suppliers from speaking to me for the life of my agreement.
- The Energy Advisor, when entering into price locking or unlocking transactions, shall warrant to make them at the market price without deduction or fee.
- The Energy Advisor shall warrant not take a fee for entering into price locking or unlocking transactions, which might create an incentive to increase the number of transactions that my company makes.
- The Energy Advisor shall provide transparent access to all conversations and correspondence with all third parties relating to my energy supply.
- The Energy Advisor shall provide transparent access to all data relating to my energy supply even when the contract is terminating.
Finally, to avoid getting caught out, it may make sense to serve any termination notices straight away so that your ability to change advisor or supplier is not unfairly restricted sometime in the future.
Vervantis is a leading supplier of outsourced, on-demand energy & sustainability expertise.
This guide was created to help organizations avoid costly mistakes as a result of poor energy advisors’ behavior and agreements that we have witnessed over the last 25 years.
It is in no way an exhaustive list, but as an industry leader, Vervantis confirms it abides by the principles contained in this guide. If there are other areas that organizations feel should be included, we would be happy to consider them as well.
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