Whether your business is already working with a commercial electricity broker or you’re exploring competitive energy supply for the first time, the partner you choose plays a big role in the quality of that experience. From the pricing options you see to the guidance you receive, not all brokers operate the same way.
Here are the most important questions to ask when evaluating a broker, whether that’s your current one or one you’re considering.
How Many Suppliers Do They Work With?
Before you formally engage a broker, ask how many suppliers they work with and how they plan to approach your account. That conversation is worth having before anything gets signed. Before a broker can quote you with a supplier, that supplier requires a letter of exclusivity from you. If you sign a letter of exclusivity with one broker and later decide you want to work with a different broker, that new broker may find that several suppliers are already locked up with your other broker, limiting your options or making it harder to move on.
One thing to note: not everything a broker asks you to sign carries the same weight. A letter of authorization (LOA) allows your broker to pull usage data and certain account details from your utility. It does not limit your ability to shop around. A letter of exclusivity (LOE) does. Read anything carefully before you sign it, and take the time to get to know a broker and feel confident about working with them before you commit to exclusivity with any supplier.
Do They Have Access to Market Data?
A broker who doesn’t track the market is essentially picking a day to pull pricing and passing it along. Electricity prices move every day, and without visibility into where the market is headed, the timing of your contract is largely left to chance. A broker who understands the electricity market can do more than pass through a supplier’s contract. They can tell you whether the price you’re being offered is reasonable, whether now is a good time to lock in, and which contract structure fits your situation.
Brokers who track the forward power curve, a tool that maps out what the electricity market expects prices to look like in the months ahead, are in a much better position to give you that guidance. Think of it like a weather forecast for electricity prices: it doesn’t guarantee the future, but it gives you something concrete to work with when deciding whether to lock in a rate now, wait, or take a blended approach.
If you’re considering a broker, ask them to walk you through their market analysis. How they answer tells you a lot about the depth of insight they can actually offer.
Do They Know This Market?
Energy markets are regional. The dynamics across New England, where pipeline capacity is constrained, winter demand can push prices sharply, differ from those in the Mid-Atlantic. Each grid operator has their own rules, which can vary from markets even close by. A broker with deep regional experience understands how those grid operators work, how seasonal price swings tend to behave, and which suppliers perform well in your specific market.
Local knowledge also means understanding your state’s deregulation rules and your utility’s tariff structures. Each state handles competitive supply differently, and a broker who primarily operates elsewhere may not have the depth to navigate those details on your behalf.
Are They Financially Stable?
Energy supply agreements can span multiple years, and markets can move dramatically in that time. When prices spike, suppliers face pressure to honor contracts that may no longer be profitable. Thinly capitalized suppliers and brokers can exit the market entirely, leaving their customers to find a new contract at the worst possible moment.
A broker’s job isn’t just to get you a good rate at signing. A strong broker is there to make sure the agreement holds up for the life of the contract. Ask about the suppliers they work with, how long those relationships have been in place, and whether the broker has navigated volatile periods without disruption to their customers.
Can They Help You Understand the Contract Before You Sign?
Electricity supply contracts are not standardized. Two contracts at similar starting rates can perform very differently depending on what’s inside them.
Four variables matter most:
Capacity charges. Every electricity customer is assigned a capacity tag representing the maximum demand the grid must be ready to supply for your account. Some suppliers guarantee this charge for the life of your contract. Others pass it through, meaning if your capacity tag changes, so does your bill.
Transmission pass-throughs. Some contracts fix transmission costs and some pass them through. Knowing which you have matters when grid operators like ISO-NE, PJM, or NYISO, or state regulators, adjust rates mid-contract.
Reconciliation provisions. Some suppliers include clauses allowing them to recover costs after the fact if their underlying expenses change. These can appear as unexpected line items on your bill.
Contract length and fit. A contract length isn’t just a pricing variable. It’s a commitment that needs to match how your business actually operates. A broker who defaults to three or five-year terms without asking about your locations, lease situations, or growth plans may lock you into obligations that outlast the business they were meant to serve. The right broker asks what your situation looks like before recommending a term.
A good broker walks through where the risk sits before you sign, not after you see the bill. A related sign to watch for: if your broker presents pricing without explaining why now is a good time to lock in, or without offering any alternatives, they may not be doing much market analysis on your behalf. A broker who pulls pricing when it’s convenient for them and passes it along without context is not the same as one who monitors the market and advises you on timing.
Questions to Ask Before You Sign
Use these questions to evaluate any broker, whether you’re reviewing your current arrangement or considering a new one:
- How many electricity suppliers do you actively work with?
- Can you walk me through your market analysis and what the forward power curve looks like right now?
- How long have you been operating in this region, and have you managed customer accounts through periods of significant price volatility?
- How does this contract handle capacity charges? Are they fixed or passed through?
- Are transmission costs fixed or passed through?
- Does this contract include any reconciliation provisions that could affect my bill?
What a Strong Energy Partnership Looks Like
A strong energy broker gives you access to more competitive electricity suppliers, brings real market intelligence to the conversation, reviews contract terms with you before you sign, and stays engaged as conditions change. They treat energy procurement as an ongoing strategy, not a one-time transaction.
Sprague has been working with commercial businesses across the Northeast for more than 155 years. We monitor energy markets daily, maintain relationships with a broad network of electricity suppliers, and help our customers understand what they’re signing and why it fits their business.
If you haven’t reviewed your electricity contract recently, or you’re not sure your current broker is giving you the full picture, we’re happy to take a look. Start here.
