For many businesses, the process for buying energy has become routine. When your current agreement nears its expiration date, you sign a new contract and agree to the terms and price provided by your energy company. But when falling into this energy-buying pattern, many businesses overlook key aspects that could reduce costs over the long term.

Despite their best efforts, some businesses still succumb to several common pitfalls that cause them to spend much more on energy than they need to. Here are three costly mistakes to look out for when buying energy, and what you can do to avoid them.

Only Buying Energy When the Contract Expires

If your business is only buying energy when it’s time to renew your supply contract, you’re likely spending more than you need to. If electricity prices happen to be particularly high when you renew your contract, you could be paying above-market prices over the course of your agreement.

Energy prices are constantly fluctuating, and you can buy energy far in advance of your next contract. That means businesses that set up their energy supply agreement on a fixed price model can capitalize when energy prices are low and secure long-term savings proactively.

Not Knowing the Right Time to Buy

Hoping to take advantage of low energy prices, some businesses look to buy in the spring and fall seasons. Prices typically peak in the winter and summer seasons due to the effect of increased demand for heating and air conditioning. Since natural gas is used to generate electricity, low supply means higher prices for natural gas, which impacts electricity prices for customers.

You can see why so many businesses assume the spring and fall seasons are the best time to buy energy. If there are moderate temperatures during these seasons, demand and cost for natural gas and electricity prices will fall as a result. However, energy prices can sometimes hit their lowest during the winter or summer months, which makes predicting energy prices very difficult without the right tools and resources.

Having an Inefficient HVAC System

The efficiency of your HVAC system heavily weighs on the efficiency of the energy purchased. For example, a business could renew its energy contract with a fixed-rate plan at the right time, and their internal energy purchaser spent hours researching the energy market to try and get ahead of price spikes, but the savings could be minimal. That’s because their HVAC system is over 20 years old, and its duct system is leaking air.

Effort spent trying to purchase energy at the right moment for that big payoff in “savings” is wasted if the HVAC system is not in peak condition. Consider spending a portion of your energy budget each year to have the HVAC system inspected, tested, cleaned, and repaired. Before renewing your energy contract, schedule an HVAC inspection and tune-up with our sister company, UGI Heating, Cooling, & Plumbing, to ensure you’re maximizing your energy budget.


For more information on when to buy energy and how to save your company money on its energy expenses, visit the Commercial Energy section of our website or give us a call at 1-800-427-8545.