Weather events like dropping temperatures and extreme cold often influence energy prices, so it’s important to be prepared. Learn how fluctuating winter conditions can spike prices and how to mitigate your exposure to risk.

1. IT’S TIME TO
POLAR PROOF
YOUR BUSINESS

2. Weather events like dropping
temperatures and extreme
cold often influence energy
prices, so it’s important to
be prepared.
Learn how fluctuating winter
conditions can spike prices
and how to mitigate your
exposure to risk.
HOW TO PREPARE FOR THE UNEXPECTED

3. During colder months, your business’s furnace may work
overtime to keep your buildings heated. That means many
customers use more energy during cold months, racking up
higher monthly costs–and increasing the overall demand
for power.
WHY CAN DEMAND INCREASE DURING WINTER?

4. Cold temperatures can cause power plants to go offline,
sharply reducing the available energy supply. To keep up
with demand, less efficient ones may be brought online at
an increased cost. In 2014, a polar vortex caused power
prices to soar and reduced capacity by almost 22%.
HOW SENSITIVE ARE ENERGY PRICES?
1

5. RISK EXPOSURE
CONTRACT TYPE
Know your energy product.
49% of managers at midsized businesses don’t know the parts
that make up the pricing for their supply contracts.
1
2
WHAT CAN I DO TO
PROTECT MY BUSINESS
FROM UNEXPECTED SPIKES
Consider your risk exposure.
Choose a contract that gives your business appropriate
protection in case of cold weather energy price spikes.
Fixed-price Managed products Index-priced
LIMITED MODERATE ELEVATED
2

6. The Direct Energy Business Advisory Services team is here to
help you confidently understand your energy plan and prepare
your energy management strategy for the future.
MEET THE TEAM
DON’T GO IT ALONE.

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Sources:
1. Reuters, “PJM grid sees power plants returning after cold-weather problems.” January 8, 2014.
Monitoring Analytics, “2013 State of the Market Report for PJM.” March 13, 2013.
2. Energy Research Council, “Polar vortex effect on electricity prices.” Retrieved October 3, 2016.
DEB-0646-2016