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Energy Choice | December 11, 2014

How Weather Volatility Affects Power and Gas

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Weather is just one of the many factors that contribute to the ebb and flow of the power and gas markets.  Last winter the United States experienced record temperatures during one of the coldest winters since 1981.  The frigid temperatures brought about by the Polar Vortex drove natural gas consumption to record levels.

Increased natural gas demand led to low gas storage levels, and this shortage in storage contributed to increased prices for the remainder of 2014 and for the calendar year 2015.  The effects of the Polar Vortex presented an unwelcome lesson to small businesses that had not fixed their gas or power rates.   Business owners quickly realized the importance of price-risk management, planning for the unexpected, and the impact of energy market volatility on their bottom line.

This year is already showing similar patterns.  The early arrival of below-normal temperatures has driven gas prices up, and as we learned last year, there is no limit to how high gas prices can go.  That’s why it’s important for small businesses to understand that not all energy suppliers are the same and an energy supplier’s stability matters, especially during instances of market volatility.  Constellation’s business model is designed to ensure long-term stability and to withstand the effects of short-term energy price volatility.  The bottom line: we are committed to helping our customers protect their businesses by offering long-term, fixed rates.

Remember, as we approach the winter season, cold temperatures can increase market volatility, which can impact your business’s bottom line.  Protect your business by choosing a stable energy supplier that is committed to serving your business through market volatility.

Here is Constellation’s commitment to our small business customers:

  • We are committed to being a leading supplier of energy and energy services for the long run.
  • We will continue to offer programs that provide customers with price certainty and price risk management for terms as far out as 1-4 years.
  • We will continue to help customers develop energy plans that take price, timeframe, risk tolerance, and budget objectives into consideration, provide clear and understandable terms and contracts, and deliver account management services that make it easy to manage your energy budget.
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