SOLUTIONS / CASE STUDIES
DATA DRIVEN CASE STUDIES
TO HELP YOUR BUSINESS LOCK IN
ON A LOWER ENERGY RATE.
The following studies occured on or after the date of January 1, 2020.
some information has been generalized for security purposes.
OPPORTUNITY TO SAVE.
TRUE BROKERING MODEL
"GOOD ACTIONS GIVE STRENGTH
TO OURSELVES AND INSPIRE
GOOD ACTIONS IN OTHERS."
STATES ANANTA OPERATES IN
"We have been managing the energy needs for this current client since 2017 in the Ameren (IL) territory. The client expanded into Shorewood (Joliet), IL with a new development in ComEd (IL) territory. Near the end of construction, our client gave us an opportunity to review and analyze the first couple of invoices. Even though there was minimal usage during this time, and the hotel wasn't officially opened due to some construction, Ananta was able to shop his rate by approximating his energy usage and building an energy profile by looking at a similar hotel we're hedging for in our portfolio. He was paying a rate of , hence, we realized now was good time too start shopping around. End result, we were able to negotiate his ComEd Hourly rate of $0.06835/kWh down to $0.03725/kWh. This reduction yeilds a 45% savings on his energy supply rate, and based on his approximate energy consumption for a 114 room hotel, should yeild him annualized savings of $15K a year in energy overhead. "
When we first came across this opportunity, we were happy to learn it came from Dan Ames, our former Operations Manager. Having a previous relationship with management, Dan learned they were overpaying from a simple invoice analysis. When running their energy requirements through our suppliers for both electricity and natural gas, we ended up finding discounted rates yielding Adversity VBC $3K/year on their ComEd electric bill and $6K per year on the People's Gas natural gas bill.
We have been managing the energy needs for this current client since 2012; however, when this hotel was acquired, they had asked us to hold off on this property, so they can test the market and see how AEP-CS default rates were looking. After analyzing 9 months of invoices, we had determined this property was paying a weighted-average-rate of $0.05105/kWh, hence, we realized now was a good time to start shopping around and locking it in. End result, we lowered their electricity rate by more than a penny yielding 22% savings from the supply portion of their AEP electric bill, which essentially saves this property over $5K a year in total energy overhead.
Excellent example of one of our current clients who consistently hedges every year 12 months at a time. We have her on our aggressive tracking model, where we begin to start tracking her renewal pricing 6 - 9 months in advance. See below for historical tracking example. She elected to jump on some market dips we saw early March, 2020, for her enrollment in May, 2020. Her new rate is considered a benchmark low from what we have seen during our 5 year relationship. We have been tracking the pricing on her renewal account since Thanksgiving, 2019.
Based out of Columbus, OH, this group currently owns and manages 13 hotels with nearly 2,000 rooms spread between 7 states! With more hotels in their pipeline, management was seeking a centralized approach towards managing their energy process. This DoubleTree Suites by Hilton is 1 of 4 hotels we had an opportunity to hedge for them, and the savings estimate for this property specifically is based on a weighted-average-rate analysis we calculated on their 2 most recent DPL (Dayton Power & Light) electric bills. This is a new relationship built on transparency allowing this hotel group to sit in the driver's seat while we navigate them to getting the best possible energy rate.
This is a great example of a current Ananta client taking advantage of a future-dating option. This client has a locked-in rate ($0.04688/kWh) expiring in November, 2020. Given the market dips we experienced during the global pandemic in March 2020, he took an aggressive approach and locked in his future-energy rate ensuring his budget is reduced by $3000 in 2021. We value our clients who do short-term hedges and take an aggressive approach at hedging their energy budgets. Our Ananta Team tracks the market daily and monitors these dips, or increases daily. For some, it's a waiting game on simply locking in when the price is right.
Great example of a new hospitality client we brought on board that had an expiration date in 2020. The client was actually with a competing supplier that we currently do not have an existing relationship with, so we did face some challenges on this one. Without the proper end-date, we aren't able to give a definitive price. However, after 90+ minutes of back and forth with the previous supplier, they were able to release the end-dates. Once identified, we were able to come in with some aggressive pricing yielding 20% savings from the expiring supply rate. Hence, a lot of collaborative effort between the Hotel Group and Ananta allowed us to win this one.
Piggy-backing from their success on future-dating their Staybridge Suites energy agreement, Sintel Properties elected to hedge the energy agreement for their second hotel property near OSU campus as well. Finding rates under 4 cents per kWh, management went ahead and future-dated an energy agreement for this hotel as well yieiding approximately $7,600 in annual savings. In an effort to synchronize their two beautiful hotels, Sintel elected to go with an 11 month option here, so they can aggregate their two hotels next year and reduce the risk premiums that are normally assessed from staggered start-dates.
Procuring their electricity contracts with Ananta since 2012, the Corporate Controller for Sintel Properties contacted us 10 months prior their energy contract expiration in an effort to explore market dips that took place in February, 2020. After monitoring their two OSU campus hotels for 10 days, they were able to find a benchmark rate and secure their budget for 2021. Essentially, they made a decision 10 months in advance to save $6,300 in an effort to reduce their energy overhead in 2021. What could your 90-room hotel do with an additional $6,300 of working capital?
Client is also a friend from the Cincinnati Volleyball Club and had his energy contract coming up for expiration this September, 2020. Once he reached out, we began pricing out the account between our 7 energy suppliers. After allowing all 7 companies to bid this out, we received a very aggressive offer under 4 cents per kWh ($0.04/kWh), hence, the client elected to jump on it and secure his rate for the next 4 years. Historically, we've seen pricing come back in the mid to high 4 cent range, so any long term rates under 4 cents are a clear no brainer, and can ensure your energy budget remains nice and low allowing peace and mind for you to manage other areas of your business.
This was our very first opportunity in PPL (Pennsylvania Power & Light) where they were with the default company paying an energy supply rate between $0.062/kWH - $0.063/kWh for the first 3 months they were open. After pricing this account with a handful of energy suppliers, Direct Energy came out winning this bid with the most aggressive offer. Client had interest in signing up for the long-term, but we ended up hedging two deals; One 12 month agreement for a short-term aggressive hedge that ended up being the most cost effective approach, and then one future-dated hegde for 31 months which ended up being lower than the initial 48 month option. Ultimately, we took a clients initial option and turned them into two aggressive options.
One of our multi-unit hoteliers we currently broker energy for between OH and CT recently acquired a Hampton Inn in Belle Vernon, Pennsylvania. Upon receipt of his first real invoice of usage, we learned he was on a default rate paying $0.05722/kWh. Newly licensed in PA, we learned that PA has a GRT (Gross Receivables Tax) line item that's actually included in the rate to compare, you see visible on the electric bill. When pricing this out, we learned that nearly all the energy suppliers we work with do not include this GRT line item; however, it's always 6.27% of the negotiated supply rate with the supplier. Ultimately, Hudson Energy came out as the winner on this one, and we went ahead and locked this in for 12 months securing a rate 15% savings from the WestPenn Power default rate.
One of our first clients, Hawkeye Hotels, have continued their expansion plan near Pittsburgh, PA with a Hampton Inn & Suites located in Cranberry Township, PA. With this market being relatively new, we wanted to study the default utility rates in Penn Power. After analyzing 8 invoices, we realized that that Penn Power was charging a variable rate every single month. In some months, half the billing period was charged one rate, when the other half was charged a separate rate. Ultimately, once analyzed, we calculated that their weighted-average rate (rate-to-compare) was $0.06979/kWh. When shopping around apples-to-apples, we learned that we were able to reduce their energy supply rate by 38%. Hence, this 110 room hotel is anticipated to save $13K annually over the next 3 years, or so. What could your hotel do with an extra $13K in working capital?
Kriya Hotels is a premium Dallas-based hospitality management company. For the last decade, they've been procuring their energy agreements through a tried-and-true energy consulting company local to TX. This was a competitive bid situation where Kriya allowed us to represent a handful of energy providers and our competitors a handful of energy providers. In the end, we came out on top with the most aggressive 12 month option. Kriya's client elected to go on a short-term hedge and fare out the next 6 months to see how he'd like to proceed on future energy agreements.