Navigating Energy Contracts in 2025 with Capacity Rate Hikes (PJM-GRID)

As we step into 2025, many businesses are facing new challenges in managing their energy contracts, particularly with full-requirements products. At Ananta Energy Source, we’ve been listening closely to our customers and reviewing the feedback from several pricing requests earlier this year. What’s become clear is the difficulty of making true apples-to-apples comparisons with traditional full-requirements energy products.

Understanding the Impact of "Change-in-Law" Clauses

One of the key factors contributing to this complexity is the "change-in-law" clause commonly found in many full-requirements contracts. This clause allows suppliers to adjust prices when there are changes in legislation, regulations, or market conditions. For example, the upcoming capacity rate hike scheduled for June 2025 is an important change that could affect many of our customers' energy costs.

At Ananta, we’re having in-depth conversations with our supplier partners to gain clarity on how each may handle potential rate hikes. Specifically, we’re looking at suppliers' past practices—have they exercised their pass-through rights before, and if so, under what circumstances? Our goal is to anticipate which suppliers are likely to exercise this option in the future.

What This Means for Our Customers

For businesses with full-requirements deals extending beyond June 2025, it’s essential to understand how these changes might affect your rates. Here are a few key questions we’re working to clarify with our supplier partners:

• Will the capacity rate hike be passed through to customers on long-term contracts, such as those running until December 2025, and beyond?
• If not, what documentation can suppliers provide to confirm that rates will remain fixed?
• If yes, how much of an increase should we expect, and how will it impact our clients' energy bills starting in July 2025?

Our priority is to ensure that we communicate these details clearly and accurately to our customers. Whether the answer is yes or no, having transparent documentation is critical to helping businesses plan ahead.

Exploring Different Energy Products: Pros and Cons

As we gather this information, we’re also committed to helping our clients navigate the different types of energy products available. From full-requirements contracts to capacity adjustments and capacity pass-throughs, each option has its advantages and challenges. Here are some factors we encourage our clients to consider:

• Full-Requirements: Often simpler to manage, but may be subject to rate hikes if a change-in-law clause is included.
• Capacity Adjustments: Some suppliers hedge capacity line items for a specific period. We recommend verifying how long these are hedged and when they’re expected to change.
• Capacity Pass-Through: Offers more flexibility, but may expose customers to future cost increases.

Understanding the nuances of each product is key to making informed decisions that align with your business's energy goals.

Our Commitment to Transparency and Client-Centered Service

At Ananta Energy Source, we’ve always put our clients first. That means being transparent about our margins, leading with education, and ensuring our customers have all the information they need before committing to a new energy contract. As the market evolves, we’re seeing more of our hotel clients lean towards short-term hedges. Many are taking a more real-time, adaptive approach to managing their energy budgets—and we’re here to support them every step of the way.

With over 180+ hotel renewals in Ohio alone, our team is working hard to stay ahead of these changes and continue providing the best possible service to our clients. We’re actively gathering feedback from suppliers, refining our proposals, and offering true apples-to-apples comparisons between different energy products.

Join the Conversation

If you have questions about your full-requirements contract or want to explore the best energy solutions for your business, we’re here to help. Contact us today at info@goananta.com, and let’s work together to find the right fit for your energy needs.