Business : Practical Gas Reduction Strategies
Posted by: Mark Walters / Category: Commercial EnergyPayroll, benefits, advertising, marketing, utilities; all of these expenses and more are major concerns for any business. Gas is one of those costs that can become a budget buster if allowed to get out of hand, especially for businesses that consume a large amount. It isn’t as though a large number of gas suppliers are there from which to choose, so it is vital that a business gets the best deal on gas to avoid spending an exorbitant amount of money on the energy.
A business that is just starting up operations and is still in the construction phase would benefit from placing a plant near a high pressure gas line. This saves on construction costs because the gas line is nearby, requiring less piping. More importantly, it saves a great deal of money on transporting the gas because the plant is right by the line. A pressure reducing station would be required because it is against the law to run gas directly to a building on a high pressure line, but future savings on gas delivery compensate for the station. Large facilities such as glass or steel plants would most likely be the pertinent businesses in this situation.
Great deals on business gas can be obtained by purchasing futures. If the rate of gas is low, a certain number of BTUs can be bought at that rate, which prevents high costs if the rate increases throughout the year. The contract that is signed ensures the low rate. Many business accountants advise hedging against 50% of gas consumption projections, but some businesses might be better off to hedge against more than 50% if the going rate of gas is especially low.
If a business is comprised of many different locations, all of the satellites can pool their buying leverage to obtain a deal on business gas. It is almost the equivalent of buying gas in bulk. When one, single branch of the business asks for a deal on gas, they may not get a figure that is not much of a savings. If all of the satellites, however, get together to increase leverage, the supplier might see the potential for more sales and agree to an aggregate plan. It is also in a business’s best interest to stay abreast of current electricity and fuel oil rates. Alerting a gas supplier that reliance on these alternatives can be increased might lead to a gas deal as well.
Being aware of the options is the best way for a business to receive a good deal on gas. Leverage, speculation, and alternative fuel all play a part in the process of purchasing gas. The best deal can be found by doing some homework.
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