Tradition Energy Educates Power Customers on Market Volatility and Impact of Credit Crunch11/04/2008
Houston, TX (Monday, November 3, 2008)—Tradition Energy, one of the nation’s largest energy management advisors, last week held seminars in Houston and Dallas to educate energy decision makers on how the nationwide credit crunch is impacting energy procurement options in the Texas market.
“Already in 2008, several suppliers have exited the ERCOT market, and there are several others essentially on watch with ERCOT,” says Brian McDermott, Senior Director of Pricing & Operations, Tradition Energy. “We are seeing some consolidation as suppliers merge, and the Public Utility Commission has implemented stringent new financial requirements to enter the market.”
As a result, suppliers are levying credit risk premiums of at least $5.00 per megawatt hour, and the premiums are likely here to stay, even after credit markets recover. Contract terms are becoming much shorter, with many suppliers no longer offering any contracts longer than 12 months. End users are now also being asked to provide detailed financial information and large deposits.
“The bottom line for energy decision makers is that it’s necessary to develop a comprehensive energy management program to identify ways to reduce costs and consumption,” continues McDermott. “The market has also experienced unprecedented volatility this year—NYMEX gas prices saw a 32% increase from January to July, and a 46% decrease from July to now. In this economic climate, partnering with an experienced energy advisor makes more sense than ever before.”
Inquiries
Jennifer Santiago, (713) 609-9927, jsantiago@traditionenergy.com
About Tradition Energy
Tradition Energy is one of the nation’s largest energy management and procurement advisors, helping commercial, industrial and governmental organizations manage electricity and natural gas costs in regulated and volatile deregulated energy markets. Tradition Energy is a division of TFS Energy, a top wholesale energy brokerage with eight offices worldwide, over 250 employees and in the energy business since 1986. In 2008, TFS Energy was named “Broker of the Year” by Energy Risk magazine. TFS Energy was also recently awarded 14 awards, more than any other company in the 8-year history of Environmental Finance magazine’s industry survey. TFS is a subsidiary of Compagnie Financiére Tradition (CFT), a leading global inter-dealer broker in financial and commodity-related products with a presence in 26 countries and over 2,400 employees. For more information, please visit www.traditionenergy.com