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Procurement

Supplier Management

Our relationships with suppliers allow us to negotiate better terms on your behalf and provide an unbiased recommendation to you based upon our understanding of your requirements.

We review all UK suppliers twice annually and ensure they all continue to adhere to UIG’s fairness and transparency policy.

UIG provide a balanced view of commodity and non-commodity costs to ensure that the offers you receive are easy to compare.

A detailed legal review of supplier terms and conditions is available to ensure that you have full visibility of any contentious clauses or penalties that may exist.

Commodity and Non-Commodity Elements of your Energy Bill

When you receive your electricity bill, roughly half of the cost is known as the commodity cost — this is the cost of the physical power, or the raw commodity.

The other half is made up of “non-commodity costs”, these are costs on every energy bill and can change dependant on time, location, amount of energy consumed, and your choice of supplier. Some of the main non-commodity costs are transmission costs, distribution costs, taxes and levies and delivery charges (the cost of getting your energy to you).

Until very recently, UK consumers could only manage the commodity costs of an energy bill, while the non-commodity costs were set at a fixed price. Utilising non-in-house commodity and energy tax experts, UIG can now offer a range of options when it comes to both sides of your bill.

UIG Absolute – Risk Managed

Our “Absolute”, risk managed approach enables you to make multiple buying decisions, with full control over when you buy and how much energy you buy each time.

We can monitor and manage your purchasing decisions for you or alongside you, using our knowledge of the market and your knowledge of your business to secure you the optimum price for your energy.

The non-commodity element of your energy bill can be divided into fixed and pass through categories. 

Fixed price non-commodity costs allow you to achieve 100% budget certainty at a higher cost (largely down to the fact that suppliers will often build a risk premium into a future non-commodity rate that isn’t yet set), whereas “pass through” costs allow you to pay the cost rate for your non-commodity billing as and when the rates are released. With UIG’s expert, careful analysis, we can help you to effectively manage this risk and keep you from paying more than you should.

Fixed Price

If you like absolute budget certainty when it comes to your energy costs, ensuring there can be no rises during your supply period (whilst also accepting that prices won’t drop if the market does), then fixed price procurement may be the best fit for your business.

UIG have a vast array of solutions to help you get the most from your fixed price contract – which are the least complex energy contracts. Under a fixed contract you make a single transaction at a prevailing commodity price and this is the price you pay for the full contract duration.

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