Switching Your Supplier: Should You Go Direct or Use an Energy Broker?
Choosing whether to go direct with an energy supplier or work with a broker can significantly impact your business’s energy costs, time, and peace of mind. Understanding the differences helps you make an informed decision tailored to your team’s capacity and energy goals.
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Key Takeaways
Deciding whether your business should go direct or partner with an energy broker is crucial. If you have your own energy procurement team, going direct may be the option for you. However, if you are unsure about how to choose an energy plan, like many other businesses, you may want to consider tailored energy broker services. Brokers are third-party professionals who handle the negotiation and energy procurement process to help secure the best contracts for you.
- Energy brokers handle the research, negotiation, and ongoing management, saving your team time and effort.
- Going direct gives you full control but requires in-house expertise and attention to market trends.
- Brokers often provide access to more suppliers and competitive rates through established industry relationships.
- Transparent broker services, like those from Integrity Energy, can be free to your business while providing ongoing support and strategic guidance.
What Does an Energy Broker Do?
Commercial energy brokers are experts in the industry, providing you and your business with support in navigating contract terms, understanding the differences between plans, keeping up with market changes, and even managing your renewals. While some charge fees to companies for their services, Integrity Energy provides all our services at no cost to your business, thanks to our agreements with our supplier network.
What Does It Mean to Go Direct?
Going direct means that you are cutting out the middleman and working one-on-one with a retail energy supplier to receive your gas and electricity. By selecting this route, you must have the time and a dedicated energy manager or internal team available to research suppliers in your area.
Another thing you must consider is that you are responsible for reviewing your contract and staying on top of your renewal date. This also means you need to keep up with market trends to be better prepared to negotiate the best rate possible.
If you handle the above, there are benefits to reward your hard work, including the possibility of fewer fees, direct communication between you and the supplier, and simple contract structures. Going with a direct energy supplier will go as well as the effort you put into it.
This method is best for businesses with an in-house energy management team that has simple and straightforward energy usage.
Key Differences Between Energy Brokers and Going Direct
| Category | Energy Broker | Going Direct |
| Time/effort | Minimal amount of time required—your broker handles almost everything. | Very time-intensive—you are responsible for every step of the process. |
| Market access | Access to multiple suppliers in your area and wholesale rates that aren’t available if you are going direct. | Limited market access—you must go through suppliers one-by-one. |
| Pricing | Pricing is often competitive due to brokers negotiating and having prior relationships with suppliers. | Pricing may be less competitive from lack of negotiation and no prior relationship with supplier. |
| Expertise | Has experience and knowledge of all processes pertaining to energy procurement. | Limited to you and your internal team’s energy procurement knowledge. |
| Support | Offers ongoing support with any billing issues or renewals. | Self-managed by your internal team with limited supplier support. |
When Does It Make Sense to Use a Broker?
Working with an energy broker makes the process simple, so your business can focus on more pressing matters, all while knowing that your energy needs are being met. Integrity Energy, along with a few other brokers, provides our services at no cost to you, as we get paid by the suppliers, not you. From leveraging their relationships, they can secure multiple, different supplier contracts to provide your business with choices.
No two businesses are the same, so it is important to have different options when shopping for energy plans to find the perfect fit. An underrated benefit of working with a broker is that they can provide you with ongoing strategic advice and direction. They remind you when you are up for renewal and support you in the process. This ensures you never have lapses in your plans. If you value your business’s money, time, and overall peace of mind, working with an electricity broker is the best fit for you.
How Do Broker Fees and Commissions Work?
There are three typical pricing models when it comes to brokers and their payment: commissions, fixed fees, and supplier-paid fees. Commissions are small percentages added to your energy rate. Fixed fees are paid directly by you, the client for the service, and supplier-paid fees are included in the supplier’s contracts.
Brokers can operate differently, so it is important to ask questions regarding any fees. Some show the fees and how they get paid up front, while others do not. Don’t be afraid to request details of their fees and any hidden fees. If a broker does not represent how they get paid on their platforms, it may be in your business’s best interest to find a reputable one that does. Integrity Energy operates with full transparency. We utilize supplier-paid fees, so our consultative and brokerage services are always completely free to your business!
Specific Scenarios for Using Energy Brokers
- – Businesses that have large energy loads, like industrial and commercial data centers, are searching for ways to reduce demand charges and optimize their rate.
- – Companies with multiple locations who are looking to consolidate their energy plan contracts into a single contract.
- – Businesses who have small or no internal energy procurement teams.
- – Companies in areas with volatile energy markets, who are searching for rate stability.
- – Businesses who are looking for custom contracts to meet specific wants and needs.
How Integrity Energy Can Help Your Business
Integrity Energy is committed to helping businesses make the best choice for themselves when choosing between going through an energy broker or going directly to the supplier. Our team offers expert advice and guidance; while also providing you with simple, side-by-side supplier plan comparisons so you can make an informed decision. We take everything into consideration when finding your business suppliers, like your energy usage and energy goals.
We are committed to transparency, which is why we have no hidden fees or costs, providing customers with free access to our services. We work with you and provide support whenever necessary to ensure you are confident in your long-term energy strategy. Discover rates in your area with Integrity’s energy experts today!
Unlock Savings & Find Your Business’s Perfect Path
Deciding which route to take regarding your energy needs can have a huge impact on your energy bill. Energy costs are a major budget item for any company, so doing whatever it takes to get it right is important. Get in touch with our trusted energy brokers here at Integrity Energy and start comparing options in your area with expert guidance.
Frequently Asked Questions About Energy Brokers and Contracts
How do I know which energy option is right for my business?
It depends on your business’s specific needs, size, and energy usage. An energy broker is an ideal option if you are unsure about which plan to choose. Integrity’s brokers will navigate the market for you and provide professional guidance.
Do energy brokers cost more than going direct?
Not necessarily. It is possible but unlikely due to energy brokers being able to negotiate lower rates than their commission or fee comes out to. Many brokers are supplier-paid anyway, meaning you don’t have to pay for the service at all. Integrity Energy is 100% supplier-paid, so you have access to our services for free!
Can I customize my energy contract either way?
Yes, but it is tougher to do without a broker’s leverage and relationship with a supplier. Negotiation plays a huge role in customizing your energy contract.
Is using an energy broker better for small businesses?
It can be. Smaller businesses typically do not have their own energy procurement teams, so it may be best for them to go with an energy broker to ensure they get the best deal.
Do brokers only show plans from certain suppliers?
Brokers offer plans from suppliers with whom they have a partnership with. It’s possible that an energy broker doesn’t work with every single supplier in your area, so it’s important to ask about how they choose their plan recommendations.
What types of energy contracts can I choose from?
It depends on the supplier and area your business resides in. Most deregulated markets offer fixed-rate, variable-rate, block and index, and time-of-use contracts. Some brokers even offer hybrid, customized contracts depending on your situation and energy goals.
How long should my energy contract be?
Typically, commercial energy contracts last anywhere between 12 to 36 months. Some contracts are shorter, while some are longer. It depends on your business’s goals. If you want rate stability, it may be best to lock in your contract for as long as possible. If you want to take advantage of fluctuations in the market, a shorter contract may work better.
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Jordan Domingo
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