Several factors have combined to create an imbalance between natural gas supply and demand, which has driven natural gas costs to double this year. Organizations that developed energy procurement strategies well in advance of this year likely locked in long-term natural gas and electric supply contracts in 2019/20 and will be protected from current market pricing increases for now. However, organizations that do not have supply contracts through the winter of 2021-22 will be exposed to natural gas pricing above $6 per one million British Thermal Units (MMBTU), which is the highest pricing seen since February 2014 during the polar vortex.
Factors that have recently influenced natural gas and electric supply pricing include:
There is some good news:
However, energy markets are vulnerable to increased pricing volatility, influenced by:
The Stone House Group can help organizations develop tailored energy procurement strategies to avoid exposure to pricing increases like we are seeing today. Additionally, our team of operators and engineers can work with your organization to manage energy consumption and energy emissions.