NUS transitioned client from fixed-price purchasing to green flexible contract and implemented a conservative, budget-driven procurement strategy generating an average cost saving of £80,000 per month for three years.
Several years ago, an international data center solutions provider was looking to implement a global energy management program. Due to its extensive international coverage and local market expertise, the provider chose NUS Consulting Group. The parties have established a longstanding relationship. The client's core data center operations in the London area have an annual power demand in excess of 250GWh. Prior to engaging NUS, the client has procured energy exclusively fixed-price supply agreements.
After several meetings with the client's various energy stakeholders and explaining in detail the benefits and risks of flexible supply agreements, the client agreed to transition to a 36-month flexible product, covering 100% of the client's electricity demand with 100% renewable energy. The NUS project team drafted and issued a detailed and well-timed tender to select the most suitable flexible supplier. After evaluating the client's risk tolerance and procurement goals, NUS's Markets, Trading & Risk (MTR) team pursued a conservative portfolio procurement strategy consistent with the client's risk-averse, budget-driven philosophy.
NUS's MTR team engaged in active market monitoring and data modeling to identify pricing windows with favorable wholesale market conditions. The goal was to drive down the client's weighted average wholesale price (WAP) of electricity while providing a degree of budget certainty to the business well in advance of the corresponding supply date. The result was a price benefit of approximately £4/MWh, based on forward market pricing at the time of contract negotiation, constituting a cost-saving of £2.88 million over 36 months, or £80,000 per month.
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