Dolphin Products is a Melbourne-based industry leader in injection moulding and tooling of complex plastic products.
The plastic moulding business is energy-intensive.
Leading Edge Energy reached out to Dolphin to present them with an opportunity to reduce their electricity bill substantially.
By securing their next contract in advance whilst the wholesale prices were low, Dolphin Products’ retail rates were reduced by 56 percent, and their total annual spend was reduced by 28 percent.
How we did it
We always stress to large market energy users the importance of market timing when it comes to contracting for electricity procurement to secure low rates.
Dolphin was tied to a contract until December 2022, which was signed at the time when electricity wholesale prices were high due to multiple long-term outages at multiple power stations.
Because supply at the time was tight and demand was growing, market forces came into play, inflating costs to near-record highs.
Since then, power stations have returned to action. Australia also entered prolonged lockdown due to the Covid 19 pandemic during a very mild summer thanks to La Nina, resulting in a much lower demand for electricity.
During that period, wholesale prices dropped to 5c/kWh from record highs of 11c.
Leading Edge Energy advised Dolphin Products that electricity prices were looking very attractive for the next few years!
We went to market for a contract period commencing January 1, 2023 exploring one to three-year terms.
Because the wholesale futures price for electricity was so remarkably low, the ensuing retail offers presented by Leading Edge Energy were also remarkably low.
The rates Dolphin Products have secured for their next contract are more than 56% lower than their current rates. This results in savings of 28% on their total energy spend.
Since Dolphin Products secured their retail contract, the wholesale market prices have increased significantly.
This means that they are currently set to pay well below the market price for their next contract.
Over the years Dolphin Products have reduced their Carbon footprint with the introduction of Lower Energy Electric Injection Moulding Machines, a Power Factor Correction device, and government-sponsored LED lighting, in both the offices and factory.
These changes combined with the new Energy Contract negotiated by Leading Edge Energy will provide a significant benefit for Dolphin Products and the environment.
“Leading Edge Energy has always been proactive in advising us when wholesale prices are advantageous to our business. Thanks to their vigilance and knowledge of the wholesale futures market, we have been able to save substantially on our electricity costs” – Mario Turcarelli Dolphin Products Managing Director
The below graph shows the historical wholesale electricity prices going back to 2015, which fluctuate drastically and regularly.
How much can your business save?
Wholesale electricity prices are still at remarkable lows, however volatile prices lie ahead as the grid converts to renewable energy.
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Going to the market at the right time to purchase wholesale energy can result in big savings.