One thing I've learned over the years is that energy prices rarely move for just one reason. Today, a combination of global fuel markets, infrastructure constraints, weather, policy decisions, and changing demand patterns all influence what organizations ultimately pay for power. Sometimes it feels like you need to be part economist, part meteorologist, and part fortune teller just to keep up. Energy affordability is increasingly being shaped by a wide range of interconnected factors that extend far beyond our local markets or control. 

A More Complex Energy Market

For many years, managing energy costs was often viewed as a straightforward exercise. Compare your options, select a supplier, and move forward. Today's environment is much different. Global LNG competition, geopolitical uncertainty, infrastructure limitations, a fluid and changing regulatory market, and growing electricity demand are all contributing to increased market volatility. What happens halfway around the world can influence energy costs here in New England much faster than many people realize.  

Fixed energy rates aren't always as fixed as we would like them to be any more.  One of the more significant developments affecting customers is DASI, ISO New England's day-ahead ancillary services market. Let's be honest, ancillary services are not usually the first topic that comes up over a cup of coffee. However, when those costs start exceeding 10% of your retail energy rate, people start talking.  DASI has introduced additional exposure to weather-driven price swings, seasonal volatility, and more granular pricing for reliability services. As a result, costs that were once relatively predictable can now fluctuate much more frequently and thus energy buyers are diving deeper into contract language than they ever have to build in assurances or pass through risk that may help mitigate costs.

Building a Strategic Procurement Strategy

That is why affordability today is less about finding the lowest rate and more about building a procurement strategy. Timing matters. Contract structure matters. Risk tolerance matters. Organizations that take a proactive approach can often position themselves more effectively by aligning contract terms with budget goals, evaluating market opportunities as they arise, and developing a long-term plan rather than reacting to short-term market movements.  

Competitive procurement plays a key role as well. With all the changes in the marketplace, it can be hard to compare one vendor to another making a true "apples to apples" comparison nearly impossible. The rate on the contract is no longer always the rate you pay.  Everyone wants to get the best rate at the best time, but the goal is not to perfectly predict the market. If predicting energy markets were easy, procurement meetings would be a lot shorter. The goal is to build a strategy that can withstand uncertainty and help maintain budget stability even when market conditions change.  

Preparing for Energy Market Uncertainty

The biggest takeaway is that energy affordability is no longer simply a budgeting conversation. It has become a strategic business decision. Organizations that focus on long-term planning, risk management, and thoughtful procurement are often better positioned to navigate volatility and avoid surprises. By knowing your numbers and forward costs you will make better, and more educated, buys. 

And while none of us can control global energy markets, we can control how we prepare for them. If predicting energy prices were easy, we'd be having this conversation from a beach somewhere. Since it's not, strategy remains one of the most valuable tools organizations have for managing affordability and uncertainty. Because if there is one thing energy markets have consistently taught us, it's that certainty is hard to find. A good strategy, however, is always within reach. 

Want to Learn More About Energy Market Volatility? Tune in to our latest podcast episode for a deeper conversation about energy affordability, market volatility, and the factors shaping energy costs. Listen now to hear our experts break down what businesses should be watching as the energy market continues to evolve.