ABSTRACT
The contents of a quoted supply price may depend on how the customer wants his price structured. To avoid unpleasant surprises, a customer should ask to see a sample invoice for his desired price structure to clarify such issues: contract wording alone may not be sufficiently clear. The option taken by many customers due to its simplicity, all components are fixed, making it essentially a hedge against a Fuel Adjustment Charge or other variable utility pricing. If significant changes have recently occurred at a facility, it is up to the customer to instead provide projected monthly kWh usages that will then be stipulated in the contract. The higher the heat rate, the higher the factor to be multiplied by the daily (or monthly) wholesale price of natural gas. Contracts for Differences (CFD) are more like a financial than a physical product. A CFD may work well when a customer has only a few accounts.
