Fixed Price Strategy
A “fixed” price strategy provides businesses the ability to secure an all-inclusive per-unit price for a given volume and definite term for their natural gas needs. It’s a simple, stable solution for entities seeking cost stability and budget certainty.
- Cost Stability (price is protected from fluctuations in the natural gas market)
- Potential for Budget Certainty (more easily manage your budget knowing your energy costs in advance)
- Simplicity (limits the need to make ongoing natural gas management decisions)
- Potential risks include market risk (in declining markets a fixed rate can lead to a higher overall cost than an index- based rate), rate changes based on material changes in usage patterns, and in certain cases, additional costs in the event of regulatory changes or commodity peak situations
- Fixed supplier contracts may be subject to “usage bands” in which the all-inclusive price is limited to a range of usage (usually a percentage above and below historical or projected usage amount); otherwise an index or other variable rate applies to the overage or clients may be charged for the underage
Can I choose a strategy that allows the benefits of a fixed rate but also the ability to take advantage of a lower price if the market drops?
Yes, Patriot Energy does offer a hybrid natural gas strategy allowing for some amount of budget control while also providing the opportunity to take advantage of lower prices in a falling market. Take a look at our hybrid strategy (link to Franklin strategy) or have a representative contact you.
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