Fixed vs Flex: Which Energy Procurement Strategy Works Best in 2025 for High and Low Energy Users?

In 2025, energy markets remain unpredictable. Although we’ve moved on from the extreme volatility of 2022–23, sharp pricing shifts still occur due to global instability, climate-related demand, infrastructure changes, and geopolitical risk. This uncertainty is compounded by the growing urgency around net zero, which continues to influence policy, procurement decisions, and investor expectations.

For commercial energy users; whether you’re running a single office, managing a regional or national property portfolio, or buying on behalf of an NHS trust, choosing between a fixed or flexible (flex) energy procurement strategy is one of the most important decisions you’ll make.

The stakes are high. Choose the wrong model, and you may lock in rates at the peak or expose your business to avoidable price swings. Get it right, and you’ll protect your budget, improve transparency, and strengthen resilience.

Understanding market volatility and global influences is key to building a resilient energy procurement strategy 2025.

What’s Driving Strategy Changes in 2025?

Before diving into strategy options, it’s important to understand what’s shaping procurement decisions this year:

• Gas and electricity prices are still volatile, though less extreme than in 2022.
• Non-commodity charges (e.g. transmission, capacity, policy costs) now account for over 60% of bills and are increasingly fixed.
• Market access windows have expanded, allowing some buyers to contract up to 24 months ahead.
• Net zero compliance pressures mean buyers are factoring carbon intensity, REGO-backed energy, and ESG goals into their contracts.
• Procurement teams are being asked to deliver more certainty with fewer resources.

In this environment, choosing the right strategy isn’t about guesswork — it’s about aligning your energy buying model with your usage profile, your risk tolerance, your operational and financial needs.

Finding balance and stability with a fixed energy procurement strategy 2025 — providing clarity and budget certainty in a shifting market.

Fixed Procurement: Simplicity and Budget Stability

How It Works

A fixed contract locks in the energy unit rate (and sometimes other cost components) for a set period, typically 1 to 3 years, providing cost certainty and administrative ease.

Best for: Low Energy Users

Smaller businesses often benefit from fixed contracts because:

• They offer budget certainty, perfect for organisations with limited financial flexibility or fixed service charge budgets.
• The administration is simple, avoiding the need for market monitoring or in-house expertise.
• Suppliers may bundle non-commodity charges into the unit rate, reducing complexity. Alternatively, some allow partial pass-through to lower margins.

Important 2025 update:
Legislative changes have shifted some charges from consumption-based to fixed elements. This reduces the ability to mitigate costs through time-of-use efficiency, making procurement timing even more critical.

Pros of Fixed Procurement

• Easy to manage; minimal involvement once the contract is signed
• Protected against price spikes
• Fixed pricing supports financial planning and control
• Suitable for multi-site SMEs and smaller landlords

Cons

• No benefit if prices fall after contract signing
• May include a risk or duration premium
• Less transparency in how costs are broken down
• Locked-in for the full term

For many SMEs and property managers, a fixed contract still offers the best balance of simplicity and certainty; but only if secured at the right time.

Managing risks while aiming for long-term goals with a flexible energy procurement strategy 2025.

Flex Procurement: Control, Opportunity, and Risk Management

How It Works

Flex contracts allow you to purchase energy in tranches over time. This gives more control over when and how you buy, enabling you to react to market conditions and spread risk.

Best for: High Energy Users

Large energy consumers can unlock significant value through flex procurement; especially if they have experienced advisors or in-house resource to manage it.

Examples include:

• Manufacturers
• NHS trusts and local authorities
• Logistics operators and data centres
• Commercial REITs and property portfolios

Pros of Flex Procurement

• Take advantage of market dips and time buying activity
• Transparent breakdown of charges, including pass-throughs
• Better supports Net Zero and ESG integration
• Flexibility to purchase short term or adjust strategy
• Flex contracts can be converted into fixed, offering optionality
• Typically lower supplier risk margin

Cons

• Requires in-house knowledge or third-party expertise
• Exposes you to market risk if poorly timed
• Involves ongoing monitoring and decision-making

Flex procurement is more resource-intensive, but it also gives large users the tools to manage volatilityl; and benefit from it.

Comparing Risk and Control: Fixed vs Flex in 2025

Lower Energy Users: Keep It Simple, But Don’t Be Passive
If your business uses less than 1 GWh per year, fixed contracts usually make the most sense. They’re easier to manage, offer predictable costs, and suppliers often provide competitive bundled pricing.

However, timing still matters. If you fix during a market high, you’re locked in at that rate. This is why even low energy users benefit from working with procurement experts; to track the market and fix at the right time, not just close to expiry.

A trusted advisor like Inteb can provide forward market analysis, monitor contract timing windows, and ensure that what looks like a good deal today won’t feel expensive tomorrow.

High Energy Users: Think Flexibly, Act Strategically

If you’re using over 5 GWh/year, a flexible procurement strategy will likely offer better outcomes over time; especially when paired with:

• Defined risk strategy (e.g. price triggers, stop losses)
• Volume forecasting to optimise timing
• Internal governance for decision-making
• Sustainability goals, like REGO-backed supply or time-matched green purchases

Inteb supports many high-usage clients with hybrid strategies, where part of the volume is fixed and the remainder is managed flexibly; combining stability with opportunity.

Flex also allows for innovations like time-matched REGO purchasing, helping clients drill down into carbon matching at the half-hour level; an increasingly important metric for net zero reporting.

Not sure whether fixed or flexible works best? CeeJay is here to help guide your energy procurement strategy 2025 with insights tailored to your needs.

Final Thoughts: Know Your Usage, Know Your Risk Appetite

Energy procurement isn’t one-size-fits-all. It’s about matching your strategy to your profile:

• Low usage? Keep it simple with a fixed contract; but time it well.
• Medium to High usage? Leverage the market with flex; but only with the right support.
• Unsure? Hybrid models offer balance.

In 2025’s turbulent energy landscape, your procurement strategy should be aligned not only with your usage, but also with your:

• Risk appetite
• Budget structure
• Sustainability commitments
• Internal resources and decision-making ability
• Service charge budget and management

A well-informed choice now can protect your bottom line, unlock long-term value, and demonstrate climate leadership.

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