Energy Risk Management Services

Ensure your business has a plan for the ever-changing energy prices in today’s volatile market

Energy market volatility can drive up costs, but it also presents opportunities to save when prices fall. Therefore, it is challenging to know when to buy your energy and how much, as the price could be different in the future. Similar to trading on the stock exchange, our approach involves buying and selling the energy you plan to consume at different times, based on market trends and global developments. This proactive strategy can lead to significant cost efficiencies, allowing you to purchase energy when prices are low and potentially sell it when prices rise.

ETRM Services

Risk Management Strategy

At Professional Energy Services (PES), our consultants help your business respond strategically to energy market price fluctuations. As part of the energy procurement process, we develop a risk management strategy where we look at how price volatility will affect your overall costs depending on consumption, budget to accommodate for price fluctuations, and overall tolerance for risk.

Trading Strategy

Once your risk strategy is determined, our energy traders will design a trading plan from the following three tiers:

Forward Hedging

Pre-buy your entire year’s expected consumption months in advance, locking in today’s favourable rates and giving you budget certainty.

Blended Approach

Combine fixed-price blocks with flexible tranches to balance protection and opportunity.

Spot-Priced Agility

If you prefer ultimate flexibility, we can leave volumes unhedged and simply settle (“cash out”) your usage at the daily spot market price.

All tiers are managed in real time through our Energy Trading & Risk Management (ETRM) tools and reported transparently, so there are no surprises—only informed decisions.

Group Purchasing for SMEs

Smaller organisations can access the same wholesale advantages as large corporations by joining our SME Purchasing Basket. By pooling demand with peer businesses, you unlock bulk-buy prices and professional trading expertise without having to meet big-volume thresholds on your own.

Our Approach to Risk Management and Trading

Professional Energy Services (PES) will adopt a comprehensive approach to managing energy price and volume risk strategies by integrating several key components:

1. Market Analysis and Intelligence

PES will conduct thorough research and analysis using our marketing intelligence tools to monitor energy market trends, price fluctuations, and economic indicators. By utilising advanced data analytics and forecasting tools, PES can provide clients with insights into potential price movements and market behaviours, enabling informed decision-making.

2. Customized Risk Assessment

Each client will undergo a detailed risk assessment process tailored to their unique energy consumption patterns and business objectives. PES will evaluate factors such as historical energy costs, usage volumes, and exposure to price volatility, identifying specific risks that need to be managed.

3. Diverse Hedging Strategies

PES will offer a variety of hedging strategies, including fixed-price contracts, options, and swaps, to help clients mitigate the impact of unforeseen price spikes or drops. By implementing a diversified hedging portfolio, clients can stabilize their energy costs and protect their budgets.

4. Volume Management Solutions

PES will implement volume management solutions that align with clients’ consumption forecasts. This may involve demand response programs, load forecasting, and energy efficiency initiatives that help clients optimize their energy use and reduce reliance on volatile pricing.

5. Regulatory Compliance and Sustainability

PES will ensure that all strategies comply with relevant regulations and support sustainability goals. By integrating renewable energy sources and promoting energy efficiency, PES can help clients achieve both cost savings and environmental goals.

6. Continuous Monitoring and Adjustment

The energy market is dynamic; therefore, PES will implement ongoing monitoring of market conditions and the performance of risk management strategies. This proactive approach allows for timely adjustments to strategies, ensuring they remain effective in minimizing risks.

7. Stakeholder Engagement and Education

Educating clients about energy market dynamics, risk management options, and best practices will be a priority. PES will facilitate workshops, seminars, and provide resource materials to enhance clients’ understanding, empowering them to take an active role in their energy management.

By integrating these components, Professional Energy Services can offer a holistic approach to energy price and volume risk strategies, positioning clients for greater financial stability and operational efficiency in the ever-evolving energy landscape.

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Why Choose Professional Energy Services?

Independent & Experienced – Founded nearly two decades ago, PES is one of the UK’s longest-standing energy consultancies, trusted by large organisations, manufacturers, councils, educators and high-street brands alike.

Total Transparency – Our cloud-based energy reporting and management platform (Insight) surfaces every trade, contract and saving in real time, alongside consumption, carbon and site data, so you always know exactly where your money is going.

24/7 Live Trading Desk – FCA-registered traders watch wholesale markets around the clock and execute intraday deals the moment prices move in your favour, not just at renewal time.

Data-Driven Edge – Machine-learning price forecasts and 15 years of historical market intelligence fuel decisions that routinely outperform standard “fix-and-forget” broker models.

Buying Power for Every Size – Large users receive a bespoke hedge portfolio; smaller users plug into our SME Purchasing Basket to access wholesale rates normally reserved for big corporates.

Net-Zero & Compliance Built-In – We can weave renewable PPAs, REGOs, ESOS and SECR obligations straight into your trading strategy, keeping budgets on track and sustainability targets in sight.

Frequently Asked Questions

What is energy risk management?

Energy risk management is the practice of anticipating energy market volatility and using hedging, trading and procurement strategies to keep costs predictable, which shields your business from price spikes while letting you capitalise on market dips.

How is energy risk management different from energy procurement?

Energy procurement is the transaction of sourcing quotes, negotiating terms and signing a supply contract at a point in time. Once a contract is signed, it is in place until the new renewal window.
Energy risk management is the ongoing process that follows: monitoring wholesale markets, applying hedging or trading tactics, and adjusting positions so your costs stay predictable and compliant for the duration of the contract.

How do you decide whether I need a forward hedging, blended approach, or spot priced-agility trading strategy?

We analyse your consumption, cash-flow limits and tolerance for price swings, then model costs under forward, blended and spot scenarios. The strategy we recommend is the one that gives you the balance of price certainty and upside potential that best fits those numbers and the current market outlook.

When is the best time to lock in energy prices?

There’s no universal “cheapest month.” We track forward curves daily and lock tranches when futures dip below your internal cost benchmark.

What is the definition of ‘tranches’ in energy trading?

A tranche (pronounced “tronsh”) is a slice of your total forecast energy volume that you buy or hedge as a separate block.
Instead of fixing 100 % of next year’s demand in one go, you might secure it in several tranches. for example, 25 % today, another 25 % next month, and the balance later. Doing it in staged tranches spreads price risk: if the market drops after the first purchase, the next block can be locked in at the lower level; if prices rise, at least part of your demand was already bought at the earlier, cheaper rate.

What happens if market prices fall after I’ve hedged?

We hedge in stages, so only a portion is fixed at any one time. If the curve drops significantly, we can layer in cheaper tranches or unwind positions where contractual terms allow.

Can you integrate renewable PPAs or REGOs into the trading strategy?

Yes—green energy supply can be locked as a separate tranche, allowing you to hit carbon targets while still optimising overall cost.

What KPIs are in place to demonstrate the ROI of the trading strategy?

We have three main KPIs for our trading strategies:

Volume-weighted average cost (VWAC) – the blended price you actually pay, shown next to the market average so you can see if we’re beating it.
Budget variance – the difference between the energy spend we forecast at the start of the year and what you’ve really paid, updated each month.
Avoided cost in £/MWh – how many pounds per megawatt-hour our trades have saved compared with a “do-nothing” fixed-price approach.

Start your risk management and trading strategy to take advantage of the fluctuating energy prices by requesting a consultation with one of our energy consultants.