Commercial Energy RFP Template (Free Download): How to Run a Competitive Supplier Bid

The way most commercial businesses buy electricity is the way you'd buy a car from one dealership with no internet, no competing offers, and no idea what the market price is. You call your current supplier, they give you a renewal quote, you accept or negotiate from a position of near-zero information, and you hope you got a reasonable deal.

This isn't how sophisticated commercial energy buyers operate — and the financial difference between the two approaches is consistently 10-20% in annual energy costs. Multiple studies of commercial electricity procurement have documented that moving from a single-supplier renewal to a competitive, multi-supplier RFP process delivers meaningful savings independent of market conditions. In rising markets, competition forces suppliers to sharpen margins. In falling markets, the RFP captures lower prices that a supplier with no competitive pressure would never volunteer.

The Request for Proposals (RFP) process is the structural mechanism that changes the information asymmetry. When five qualified suppliers are bidding for your business simultaneously, with the same load data, the same contract parameters, and the same evaluation deadline, you gain something invaluable: market truth. You learn what competitive pricing actually looks like for your load profile, and you have concrete basis for negotiation on every dimension — rate, contract term, structure, and terms.

This guide walks through everything you need to run an effective commercial energy RFP: the pre-work that ensures quotes are accurate and comparable, the key sections of an RFP document, how to evaluate competing bids on an apples-to-apples basis, and the timeline from RFP issue to contract execution.

Pre-RFP Prep: Load Data, Utility Bills, and Letter of Authorization

Nothing undermines an energy RFP faster than inadequate load data. Retail electricity suppliers can only quote accurately if they understand your consumption and demand profile. Incomplete or inaccurate data produces quotes with bandwidth assumptions that may result in significant repricing after contract execution — wiping out the savings the RFP was supposed to capture.

What to Gather Before Issuing the RFP

12-24 months of utility bills: The primary source for consumption data, demand readings, account numbers, and service addresses. For each account included in the RFP scope:

Monthly kWh consumption (ideally 24 months for seasonal pattern visibility)
Monthly peak demand (kW) readings
Account number and service address
Meter number
Current rate class
Current contract end date and supplier (if applicable)
Utility territory (PECO, ComEd, PPL, etc.)

15-minute interval data (for larger accounts): For facilities above 500 kW peak demand, interval demand data provides suppliers with the detailed consumption profile needed to accurately price capacity-related charges. Your utility can provide this data on request; some competitive suppliers require it for accurate quoting.

Current supply contracts: Provide copies of any existing supply agreements so suppliers can see current pricing structure and identify what they're competing against. Also allows you to verify contract end dates and early termination provisions.

Projected changes: Note any planned operational changes — new equipment, production expansion, solar installation, EV fleet — that might change your consumption profile during the proposed contract term.

The Letter of Authorization (LOA)

Before a competitive supplier can obtain your billing data from the utility (typically through EDI data exchange), they require a Letter of Authorization signed by an authorized representative of your business.

The LOA authorizes the supplier (or broker) to:

Request your historical billing and usage data from the utility
Access your account information for quoting purposes
(In some states) submit enrollment requests on your behalf

Standard LOA forms are available from the retail supplier, your energy broker, or some state public utility commission websites. The LOA typically specifies:

Business name and authorized signatory
Account numbers authorized
Duration of authorization
Purpose (limited to quoting, not enrollment without additional authorization)

Important: Signing an LOA does not commit you to purchasing from that supplier. It only authorizes data access for quoting. If you're working with multiple suppliers or a broker, you'll need separate LOAs for each entity that needs data access.

Working with an energy broker experienced in running competitive RFPs can streamline this process — a broker with existing LOA templates and supplier relationships can often compress the pre-RFP data collection phase significantly.

RFP Document Structure: Required Sections and Must-Have Clauses

A well-constructed energy RFP document serves several purposes simultaneously: it gives suppliers the information they need to quote accurately; it establishes the parameters of the contract you want; it creates a structured framework for evaluation; and it signals to suppliers that this is a serious, professional procurement process worth competing hard for.

RFP Document Structure

Section 1: Introduction and Scope

Briefly describe your business, the purpose of the RFP, the accounts included, and the timeline. Keep this brief — suppliers read dozens of RFPs; they want to know the substance quickly.

Example: "XYZ Manufacturing is soliciting competitive proposals for the supply of commercial electricity for 3 facilities in Pennsylvania and New Jersey. Total annual consumption is approximately 8.5 million kWh with combined peak demand of 1,800 kW."

Section 2: Facility and Account Details

A structured table for each account:

Account number
Service address
Utility / transmission service provider
Current rate class
12-month consumption (kWh)
Peak demand (kW) — 12-month maximum and average
Contract start date requested
Contract end date requested

Section 3: Technical Requirements and Pricing Parameters

Specify exactly what you want priced:

Contract term(s): Request pricing for multiple terms (12, 24, 36 months) simultaneously
Pricing structure: All-in fixed rate vs. pass-through structure — choose one and specify it (see below)
Green energy content: % renewable content required, if any
Bandwidth provisions: Your acceptable range (e.g., ±10% of projected volume)

Section 4: Must-Have Contract Clauses

Specify required contract provisions — not just the rate, but the terms that protect your business:

Pricing expiration: Quotes must remain valid for at least 5 business days from submission
All-in rate specification: Total price per kWh must include all supply-side charges or pass-throughs must be itemized
Change-of-law provision: How unexpected regulatory changes are handled during the contract term
Early termination fee: Disclose the fee structure clearly (some suppliers charge 2-3 months of contract value)
Bandwidth clause: Specify acceptable consumption variation range
Capacity treatment: State explicitly whether capacity charges are fixed in the rate or pass-through

Section 5: Supplier Qualification Requirements

Minimum standards for supplier eligibility:

State retail electricity license (list each state in scope)
Minimum credit rating or credit enhancement requirement
Minimum years in business / accounts served (e.g., "minimum 50 commercial accounts currently serving")
Insurance requirements
References from comparable commercial accounts (same state, similar size)

Section 6: Evaluation Criteria and Weights

Be explicit about how you'll evaluate bids. A typical weighting:

All-in price: 60%
Contract terms and flexibility: 20%
Supplier credit and financial stability: 10%
Service and references: 10%

Publishing evaluation weights tells suppliers what matters most and produces better-aligned proposals.

Section 7: Timeline and Submission Requirements

RFP issue date
Q&A deadline
Response deadline (typically 7-14 days from issue)
Anticipated award date
Anticipated contract start date
Submission format and contact information

The Most Important Pricing Clarification: All-In vs. Pass-Through

This is the single most common source of apples-to-oranges comparison in commercial energy RFPs. It must be specified:

All-in fixed pricing: A single $/kWh that includes all supply-side costs — energy commodity, capacity, transmission, ancillaries, and any state regulatory charges. You know exactly what you'll pay. No surprises.

Pass-through pricing: Energy commodity is fixed; capacity, transmission, and ancillary charges are passed through at actual cost. Pass-through prices often appear lower on paper but carry exposure to market cost increases.

If you request both in the same RFP without specifying, you'll receive incomparable quotes that look similar on paper but represent completely different cost structures.

Apples-to-Apples Bid Evaluation Across Suppliers

Receiving multiple RFP responses is only valuable if you can compare them accurately. The evaluation matrix makes this systematic.

The Bid Evaluation Matrix

Build a spreadsheet with one column per supplier and rows for each evaluation dimension:

Evaluation Criterion	Weight	Supplier A	Supplier B	Supplier C	Supplier D
All-in rate (12-month)	—	$0.0865	$0.0872	$0.0851	$0.0889
All-in rate (24-month)	—	$0.0891	$0.0883	$0.0874	$0.0908
Capacity structure	—	Pass-thru	Fixed	Fixed	Pass-thru
Early termination fee	—	2 months	$0.002/kWh	None stated	3 months
Auto-renewal language	—	30-day notice	60-day notice	No auto-renew	30-day notice
Bandwidth: ±%	—	±15%	±10%	±20%	±10%
Supplier credit rating	—	BBB+	A-	BBB	A
Commercial accounts ref.	—	3 provided	2 provided	1 provided	3 provided

Adjusting for capacity structure: If Supplier A quotes an all-in rate of $0.0865 with pass-through capacity and Supplier B quotes $0.0872 fully fixed, you need to add your estimated capacity pass-through risk to Supplier A's rate to make them comparable. Use your current year's capacity charges as a proxy.

Red Flags in Supplier Proposals

Failure to provide all-in rate as requested: Supplier is hiding variable cost exposure
Early termination fee exceeding 2 months of contract value: Disproportionate penalty for an energy commodity contract
Missing or ambiguous bandwidth provisions: Could result in unexpected repricing if your usage changes
No auto-renewal protection clause: Contract could roll to unfavorable terms without notice
Capacity structure not specified: "Fixed rate" means nothing if it's fixed-energy with pass-through capacity

Review short-term vs. long-term energy contracts to understand how contract term selection interacts with rate optimization and market timing.

Award, Contracting, and Implementation Timeline

Typical Commercial Energy RFP Timeline

Phase	Duration	Key Actions
Pre-RFP preparation	1-2 weeks	Gather bills, LOAs, interval data
RFP drafting and issue	1-3 days	Draft RFP, distribute to qualified suppliers
Q&A period	3-5 days	Respond to supplier questions
Proposal deadline	Day 7-14	Receive and review all proposals
Evaluation and award	3-5 days	Score matrix, reference checks, select supplier
Contract negotiation	2-5 days	Redline key provisions, finalize terms
Utility switch processing	30-90 days	Supplier submits enrollment to utility
New supply begins	Per contract	Typically 1st of month after enrollment

Total timeline: 6-14 weeks from pre-RFP prep to new supply start

Understand that ERCOT switches can happen in as few as 2-5 business days (same-meter-read-cycle switch is possible); PJM and NYISO switches typically take one billing cycle; ISO-NE may require 45-90 days for some utility territories.

Post-Award Implementation

Enrollment confirmation: After contract execution, verify that the supplier has submitted enrollment (ESI ID or Account Number assignment) to the utility. Request a confirmation number.

Switch confirmation letter: Most utilities will send a letter confirming the supplier switch and effective date. Keep this for your records.

First invoice verification: When the first bill arrives under the new contract, verify:

The supply rate matches the executed contract
The rate class is unchanged
No unexpected pass-through charges have appeared
The billing period aligns with the expected switch date

Running Multi-Site RFPs for Load Aggregation Benefits

For businesses with multiple locations across multiple states, an aggregated RFP presents all accounts as a single portfolio, enabling:

Volume pricing discounts (typically 3-7% below single-location pricing for 5+ MW portfolios)
Consistent contract terms across all locations
Single point of contact for all supply relationships
Consolidated billing options with some suppliers

The aggregation benefit increases with total portfolio size. Multi-site operators with 10+ locations across deregulated states should almost always aggregate their procurement in a single RFP rather than renewing sites individually.

Conclusion

The commercial energy RFP process is one of the highest-return investments of time a facility manager or CFO can make. The 10-20% savings achievable through competitive multi-supplier bidding versus single-supplier renewal represents, for a business spending $500,000/year on electricity, a potential savings of $50,000-$100,000/year — recurring for the life of the contract.

The framework in this guide — thorough pre-RFP data preparation, a well-structured RFP document with clear pricing specifications and contract requirements, a systematic evaluation matrix, and a defined award and implementation process — translates the RFP process from an intimidating administrative burden into a manageable, repeatable procurement practice.

Commercial Energy Advisors runs competitive energy RFPs for commercial clients at no cost to the business — we coordinate data collection, draft the RFP, distribute to qualified suppliers, evaluate proposals, and negotiate contract terms on your behalf.

Call 833-264-7776 or contact us today to start your commercial energy competitive bidding process.

Frequently Asked Questions

How much can a competitive energy RFP save versus a renewal with my current supplier?

Industry research consistently shows 10-20% savings when moving from a single-supplier renewal to a competitive multi-supplier RFP process. The savings come from both competitive pricing pressure and the information gain that reveals what market pricing actually looks like for your load profile.

How many suppliers should I include in a commercial energy RFP?

Five to eight qualified suppliers is typically optimal. Fewer than three reduces competitive pressure meaningfully. More than ten creates proposal management burden without proportional pricing benefit.

What is a Letter of Authorization (LOA) and do I need one for an energy RFP?

An LOA authorizes a supplier or broker to access your account data from the utility for quoting purposes. Most suppliers require LOAs to obtain the interval data and billing history needed for accurate quoting. Signing an LOA does not commit you to purchase from that supplier.

What is the difference between all-in and pass-through pricing in commercial energy contracts?

All-in pricing bundles all supply components (energy, capacity, transmission, ancillaries) into a single $/kWh rate you can budget precisely. Pass-through pricing fixes the energy commodity but allows capacity, transmission, and other components to vary with actual market costs. The two structures are financially incomparable unless pass-through exposure is quantified and added to the pass-through quote.

Can I run an energy RFP for multiple locations across different states?

Yes, and you should. Multi-state, multi-location RFPs enable load aggregation, which typically delivers 3-7% volume discounts versus individual location procurement. The RFP should specify accounts by state and utility territory; suppliers bid as a portfolio with potential portfolio discount acknowledgment.

How long does a commercial energy RFP take from start to new supply?

End-to-end, from pre-RFP data preparation through new supply start date, typically 6-14 weeks. Pre-RFP data collection takes 1-2 weeks; the RFP and evaluation process takes 2-3 weeks; contract execution takes 1 week; utility enrollment and switch processing takes 30-90 days depending on the ISO territory.

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