When will things get back to normal

In late August of 2021, it seemed as though the rapid upward tick in energy costs was hard to understand. What had changed fundamentally in a few months?  Looking back, a few reasons became clear. In January 2021, the national energy policy shifted to discourage fossil fuel exploration and drilling and instead promoted renewable energy production, battery storage and electrification. In addition, excess money printed and distributed into our economy caused inflation as too many dollars were chasing too few goods. Energy prices rose to historic levels and it appears unclear where this will end.

If our nation has the ability to remedy the excess currency in circulation and we have the natural resources and capacity to provide natural gas, nuclear, coal-fired generation, independent of other nations, is this shift temporary, or are we here for the long haul?

No one knows for sure, but it seems reasonable to expect that upward price pressure will continue as long as inflationary pressures continue.

Because many saw and took advantage of falling energy prices since 2010, many cannot imagine these current price spikes will continue. But they can.

If you have an electric generation contract coming due in 2022, what should you do? While your local utility price may provide some temporary safety but, beyond June of 2023 (in PJM), no one knows what the suppliers will charge for generation. You may have to consider locking in pricing today for contracts that begin June 2023 and beyond.

We don’t want to think prices will keep increasing, but we should be planning as if they will. There is no obligation to shop and FirstEnergy Advisors is here to help you.  We encourage customers to get baseline pricing from our Sherpa by FirstEnergy Advisors™’ online pricing tool now so that when you are ready to procure power, you will make an informed decision, rather than a rushed and hasty choice that could adversely affect your budget and lock you into an unfavorable price into the future.

Be careful out there!

Lori

Image Credit: Lycs Architecture