New NAFD Energy Club drives costs down

In partnership with specialist energy consultant LSI, the National Association of Funeral Directors (NAFD) has set up the NAFD Energy Club to help drive down the costs of its members’ commercial gas and electricity bills.

Recent volatility in the energy market has not escaped the profession and while utility prices are not quite at the levels seen in the summer of 2008, they remain one of a funeral firm’s largest expenditures.

“We are committed to helping our members control the costs within their businesses and, especially in the current economic climate, the NAFD Energy Club is another excellent example of how we can use the Association’s buying power to benefit our members,” says the NAFD’s chief executive officer Alan Slater.

“It is similar in nature to the deal with we have in place on card payment rates – the lowest available in the sector – because it maximises the collective buying power of our membership. The more member companies that sign up to the NAFD Energy Club, the lower the rate we will be able to negotiate with our suppliers.”

The price of oil is a key driver of the energy market and impacts on the price of gas which, in turn, affects the cost of electricity generation. Fortunately, oil prices are some way off the recent high of $167 a barrel, but their volatility remains a concern. Thanks to its North Sea gas reserves the UK used to be a net exporter of gas, but this resource is declining and we are now becoming increasingly reliant on more expensive imported gas. New pipelines connecting the UK with major suppliers like Norway will help in the long term, but problems with delivery and flows have helped to keep the price of gas high.

Meanwhile, we also rely predominantly on gas for the generation of our electricity. We do still have some coal fired plants, operating on expensive imported coal, and a nuclear power capability which is coming to the end of its useful life, while the benefits of renewable energy have yet to be fully realised.

When their energy contracts are due for renewal NAFD members are being invited to contact LSI, the NAFD’s preferred supply partner, to find out whether it can set up cheaper deals. Initially, LSI will obtain prices for NAFD members on a one- to-one basis, although each contract will have the same common end date of 31 December 2011, because this is when the NAFD Energy Club will go to the market as a group buying scheme to secure energy prices that no individual business could achieve in its own right.

LSI enjoys successful business relationships with all the major gas and electricity suppliers and because it is not affiliated to any single company it has the advantage of being totally independent. This means LSI can give NAFD members a second opinion on the prices they are offered by their existing suppliers and can provide a free comprehensive analysis of their current gas and electricity expenditure.

“This is an excellent deal for funeral directors of all sizes and an important addition to our benefits package,” adds Mr Slater.

“NAFD members will not incur charges for LSI’s services because all energy suppliers pay a ‘finder’s fee’ which is taken into account when the contract is priced, and the prices LSI achieves are linked to the overall volume of business the consultancy conducts.”