Risk Management Services

Customized Pricing Plans Whether buyers or sellers, most of our customers do not want to be exposed to the daily and monthly swings in energy prices because they cannot budget or plan their business. Some of our customers don't mind because their business profits move with energy prices, so when prices are high, so are their profits. Our job at Commercial Energy is to understand YOUR NEEDS. Once we gain that understanding, we tailor a solution for your business.
	As of 3/24/08
Managing Our Own Risks Of course, we cannot give you everything you want and then fail to earn an adequate profit. We must do a competent job managing the risks of energy price movements so that we are in business tomorrow to continue to help you. So our practice is to match our end user contracts with our producer contracts. This is known as Back-to-Backing contracts. We use our physical assets as an internal risk management tool to match to the needs of our customers. We measure our risk exposure based on five percent of annual sales. In other words, our profits cannot swing more than five percent of annual sales based on energy price changes in the monthly markets, or we are out of compliance with our corporate guidelines. While that sometimes keeps us from "hitting a home run" financially, it has also kept us from striking out with the bases loaded.

Survival Is The Measuring Stick

The energy industry has been far more volatile than we ever imagined. The largest company in our business, Enron, destroyed itself through unethical and illegal attempts to profit from (and create) this volatility. Both of the utilities we work within, NorthWestern and PG&E, have gone into bankruptcy and re-emerged. Commercial Energy simply will not risk failing for short term opportunities. Our business is to manage risk conservatively so that we can help our customers manage their risks as they see fit.