frequently
asked
questions
We offer a range of services, all designed to help your company reach its potential. Feel free to contact us with any questions or concerns!
Bob Korandovich,President
(614) 883-6401
bobk@korenergyltd.com
The actual Term of our Demand Response is 3 years or greater. However, the Schedule A to the contract lists your reduction kW volume and Annual Payment. The kW volume can change up or down each year based on the following: your previous year’s performance and your peak kW. So, if KOREnergy sends you an updated Schedule A, it is for one of these two reasons. You do not need to sign the new Schedule A.
4. We’re in the DR program but can’t figure out why our premium payments vary every year. This year we’re getting $4000 but next year we’ll only get $3000, why?
The rate which PJM (the program Sponsor) pays, changes each year. PJM tells us the rate for three years into the future. Ultimately the rate is based on future electric supply and demand.
5. Why aren’t Constellation and KOREnergy rates for electricity better than everyone else?
While knowing your rate for multiple years may be an easy solution for budgetary purposes, it may not always be the most prudent. There are a number of factors which can influence the length of your electric supply contract. One of the primary drivers of power prices are natural gas prices. The reason for that is that natural gas fired power plants are the last to be turned on, they’re “on the margin”. So, while it is not a one-for-one correlation between power and natural gas, power does trend with natural gas.
As an example: during the Polar Vortex of Q1 2014, natural gas prices reached 10-year highs and power prices followed. Subsequently, strong natural gas production from shale wells has brought natural gas production to record levels in the US. This has caused natural gas prices to fall back near 10-year lows. Power followed suit.
These are some of the factors which KOREnergy takes into account when making recommendations to Members regarding contract term!
3. I’ve seen printers in The Communicator that have solar panels covering their entire roofs, and others with Wind Towers, is this a realistic solution to future energy needs or just the latest trends being promoted through the EPA and environmentalists?
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While every kWh produced by wind and solar does help the environment, those resources are not practical (cost and availability) here in Ohio to replace fossil fuel and nuclear generation. Generally speaking, both resources are heavily subsidized by State or Federal funding.
From a production standpoint, both resources are going to produce at times which don’t generally correlate with a Members production. In Ohio, the sun doesn’t always shine and the wind doesn’t always blow in the middle of the day. The “game changer” in this area will be battery storage which will be commercially beneficial to use.
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2. With the fluctuations of energy prices how long of a contract should we sign? On the one hand, if we could budget our energy costs for the next couple of years, that would be great, on the other, if the weather cooperates, rates could go down and we could save considerably. Is there a good solution?
The electric market changes on a daily basis. So on any given day, one supplier could be cheaper than the other. However, the real reason some suppliers are lower-priced than others is because some do not contractually guarantee the price (even though a supplier or Broker/Consultant may tell you differently). In the Ohio market, Constellation is the ONLY supplier who guarantees their price, period.
Ex. During the Polar Vortex winter, all suppliers incurred additional costs to move power across the PJM system. Constellation was the only supplier who did not pass these additional costs through to their fixed-price clients. Other suppliers did, invoking a change of law term, buried in the Terms and Conditions of their contracts. The additional operating cost was not a change in law.
These are the types of items which the Association and KOREnergy look out for on your behalf.