Case Studies: Best Practice
August 2, 2018
Reducing Costs and Risk Through Proper Energy Procurement
By Zenith Energy
Managing energy can be complex for healthcare providers. When looking at ways to reduce consumption and costs, there is a myriad of options, including lighting, on-site generation, efficiency solutions, and purchasing. The Zenith Energy program, a Navigator business partner, focuses on the aspect of energy that most organizations must do: the purchasing of negotiable electricity and natural gas.
Improving the outcome of an energy program hinges on the proper procurement of energy. Navigator GPO Members are able to realize significant savings by adopting best practices in energy procurement through the Zenith Energy program. The money saved through effective energy management can be redirected toward other operations, to sustainability strategies, or to the bottom line.
James L West Alzheimer Center, a not-for-profit organization in Fort Worth, TX, utilized the Zenith Energy program to drive more than $50,000 in annual savings (28%). What’s more, this member’s forward-looking approach to the energy markets helped them avoid a sharp upturn in market rates.
“The James L. West Center is committed to innovating and adopting best practices in all aspects of our organization from patient care to energy.” said Cheryl Harding, Chief Executive Officer. “The procurement process supported by Zenith Energy has helped us to achieve exceptional market results.”
The Zenith Energy program is center on three simple principles:
Aggregation: The energy spend of a single property or organization may not command the attention of suppliers. However, a group of energy buyers can aggregate to create buying power in the market, leveraging to total spend to achieve lower costs and greater access to the best products and contracts.
Alignment: Organizations with multiple locations and/or significant energy spend should form energy committees that include experienced in-house staff from the Finance, Procurement, and Facilities departments. The committee’s job is to develop a consensus-based energy purchasing strategy that is consistent with the organization’s long-term financial risk management strategy.
Analytics: The energy buyer should use financial analytics and risk management tools when determining the energy procurement strategy, which should balance budget stability and cost savings.
About Zenith Energy
Zenith Energy focuses on advising commercial, industrial, and nonprofit clients on the procurement and management of energy supply in deregulated energy markets. Zenith Energy has drafted new best practices in energy procurement that are driving 10+ percent savings compared to traditional methods nationwide and is committed to helping clients build comprehensive energy management plans.
To speak with Kevin Ritter, Senior Energy Advisor, about your energy needs, please call 312-478-5462