Reverse Energy Auction
What are the benefits of an online reverse energy auction versus the standard procurement process? In an online reverse auction, suppliers are invited to bid in a web-based auction in real-time. In this process, suppliers compete against each other to win your business,driving down the price in the process.
Reverse Energy Auction
Because suppliers can see the price they are competing against, but not who they are competing with, they are much more aggressive in discounting. Once the sourcing event is over, the buyer has the information he or she needs to make an informed decision. Because suppliers submit multiple bids in response to pressure, they have more opportunities to earn a buyer’s business then in a closed format. Effectively driving down prices to new lows is what makes Reverse Energy Auction your one stop energy procurement specialist.
The Value of a Reverse Energy Auction
A Reverse Energy Auction brings together over 500 plus electricity, gas and alternative energy suppliers from around the nation into a collective bidding war for our respective clients. A majority of the suppliers only participate in the auction process. They only bid on the larger users of energy. The biggest advantage of this format is that this process eliminates the suppliers sales and marketing loads to the pricing and you are only dealing with the trade desk load which the suppliers have to keep razor thin to obtain your business.
Key points of the auction process
- No costs associated to put the bid process together and have the auction
- Once auction takes place the client can reject the offer or accept it and sign a one year or multiple year contract to lock in the rates
- Auction takes place at employers location, in real-time
- Savings are typically between 10 – 20%
- Automated web based platform, each with a ‘bid’ time and date stamped based upon first bid submitted.
- Reverse Energy Auction drives energy prices down to the BARE MINIMUM!!
- Always Lowest price of any energy procurement process
- Real winner is the energy buyers
Other Benefits to our numerous clients are:
- Client can justify if their current rates are the most competitive
- Shortens Procurement Timeline
- Reduces Risks
- Supports Compliance
- Helps client achieve and manage budgetary objectives
- Significant Cost Savings
- Fulfills the green energy requirements at the least cost where applicable.
- Apples to apples comparison: With an online event or auction, the customer sets the parameters that suppliers must bid on.
- Expanding the supplier pool: The difference between letting 2 or 20 suppliers bid on an RFP is nominal. Thus, there is no marginal cost to adding another supplier to the bidding process. In essence, more suppliers mean potential lower prices.
- One event, many auctions: In an online procurement event, it is possible to run multiple auctions for the customer.
- Auction Sequence: Auctions can be run in immediate succession, by testing various bid parameters, suppliers can quickly react to a loss and sharpen their pencils to win the next round.
- Closing in Real Time: Since the underlying commodity in energy is volatile, the amount of time between accepting a supplier’s winning bid and signing the contract ultimately affects the rate.
- Audit Trail: Automation clearly has its benefits. An online procurement process can capture, catalog and time-stamp all bidding activity. This provides our clients with a thorough audit trail of their energy procurement.
- Sarbanes-Oxley Compliant
- Connection: Energy buyers gain a significant advantage when multiple suppliers in a structured online auction are bidding for their respective business.
- Other Auctions:
- Offer demand response auctions in appropriate states
- Offer a platform for carbon credit auctions