Tariff optimisation requires a thorough understanding of the tariffs available and your gas demand profile both current and future. Our consultants can achieve savings of 10% or more by carefully matching your needs with the most appropriate tariffs.
Organisations can often pay over the odds for their natural gas or LPG by not understanding their supply tariff. Even in its simplest form, the delivered price of natural gas consists of these five elements:
- Wholesale or commodity price
- National transmission cost (NTS)
- Local distribution cost (LDZ)
- Metering charge
- Standing charge
Charges are based on usage profiles, for example, a space heating demand with 75% of the usage in winter months will be more expensive than a continuous all year round process heat demand. Also, for very large users, there are penalties for exceeding the maximum hourly/daily demand, and/or failing to take the agreed annual quantity (AQ) or minimum threshold known as “take or pay” level, usually 80% of AQ.
Ensuring that you have provided the correct usage profile and factored in any future consumption increases or decreases can be tricky. It also requires a thorough understanding of the individual elements of your tariff and their impact on the overall costs. Unfortunately, the onus is on the user to select the least cost option (caveat emptor).
How can CMR help?
We adopt a 3 step process, where we:
- Check your historic invoices for any supplier billing errors.
- Review your usage profiles and assess potential savings that can be made without operational changes.
- Evaluate the options and benefits of changing shift patterns or operating patterns of certain equipment, to reduce maximum gas demand.
- Select the appropriate minimum AQ to avoid take or pay penalties.
For further information please contact us at: firstname.lastname@example.org