Tim Foster, Director of Energy for Business, Conrad Energy
In May, Rachel Reeves announced the latest in efforts to mitigate the volatility which has become a feature of the energy landscape.
Against a backdrop of the conflict in the Middle East, constraints on our grid capacity and capability, and increasing pressure and necessity to integrate renewables, energy managers can find themselves facing price and supply volatility on several fronts.
Whilst an adjustment in processes is needed to tackle this, it is a fundamental shift in mindset which is first required to underpin any developments.
Strategies for procurement, both at the start and throughout the lifetime of a contract, need to evolve to be able to contend with the intensified pressures energy managers are now facing.
Operating with precision
The key to navigating today’s difficult market is agility – regarding cost, supply, and carbon. The more detail a manager can gather about their energy usage, and the more flexible they can be to optimise this, the more efficient and secure they can make their operations.
At the core of this is fostering a proactive approach to energy procurement. This needs to be used as a strategic instrument for success, and not be seen as a reactive, cut and paste exercise.
Traditional, fixed price energy contracts can no longer offer the necessary levels of visibility and flexibility which are needed to succeed in today’s conditions. Whereas once their straight forwardness was their selling point, now it is holding customers back. Those locked into these contracts cannot make the most of advances in energy technology or times of lower wholesale prices, or respond to their own operational changes. Whilst the energy industry is characterised by its real-time fluctuations, these fixed models leave users standing still.
Instead, energy managers are and should be adopting more flexible procurement models. These incorporate multiple elements, to create a tailored and elastic set-up which is characterised throughout by advanced data insights. They can include Flexible Rate Contracts or products which match supply with equivalent levels of renewable generation on a half-hourly basis, alongside Corporate Power Purchase Agreements (PPAs) or behind-the-meter renewable assets (such as roof top solar).
The value of visibility
So, if an energy manager has access to more sophisticated understanding of and command over energy purchase and usage habits – how can this be harnessed to meet budget, renewable, and operational goals?
In short, whereas under traditional contracts a manager might have had an outline of energy habits, now they can leverage a far more intricate picture to use the right energy at the best time: an essential foundation for assessing which procurement approaches are the strongest fit for their business’s priorities and risk appetite. By building a more blended and layered procurement package, managers can react in real time to market and operational changes and carbon demands.
For instance, the detailed half-hourly consumption data can be crunched to allow stronger decision-making around how much energy to secure in advance or how much exposure should be kept to market pricing. Moreover, these are not static conclusions – the granularity of the analytics means managers can account for variability across shifts or seasonal demands, as well as across operational cycles. For managers at businesses considering big changes such as around expansion or electrification, these insights are also valuable for modelling potential impact on consumption patterns and adjusting in response.
Turning to a shorter-term outlook, and the visibility again brings clear advantages by shedding light on pricing and carbon intensity trends throughout different periods on a day-to-day basis. By tracking these, energy managers can offer guidance to their wider teams around when different business activities could be run to capitalise on lower price times and/or higher renewable availability. By aligning where flexibility is possible in operations, with flexibility in energy management, businesses can adjust energy-intensive processes to fall outside of traditional demand windows to improve cost and carbon performance, and overall resilience.
Sustainable strategies
Developing agile and robust procurement strategies has become an imperative for navigating the challenging market conditions. ‘Fix and forget’ approaches can no longer be sustained, with dynamic procurement structures and data insights taking over as the key to combating energy risks, costs, and usage changes.
Crucially, these approaches also help reach renewable goals, too. By developing a multi-layered procurement model, managers can include PPAs, for instance, as a tool to integrate low-carbon, renewable energy into operations. Moreover, by utilising matching products and the half-hourly data which innovative supply arrangements offer, managers can also demonstrate their renewable and low carbon credentials more accurately than otherwise possible to their staff, suppliers, clients and investors.
At a time of such pressure, by deploying a consistently proactive approach to energy procurement and ongoing analysis, energy managers can feel confident in developing financially and renewably sustainable models.
This article appeared in the June 2026 issue of Energy Manager magazine. Subscribe here.
