Read the teaching assumptions first

All schools, providers, rates, tax percentages, recovery assumptions and outcomes are fictional teaching examples. Annual arithmetic uses an illustrative 365-day period, not a quotation, tax classification or price forecast. Rates include all assumed variable supply charges for the example; actual offers must identify every relevant item. Embedded commission is already in the unit rate and must not be added twice. Direct advisory fees are separate. A refundable deposit affects cash held, not energy expense. Each case prices one illustrative electricity requirement. Other fuels and supplies with different tax treatment need their own comparison.

The cost comparison models one illustrative electricity requirement. Other fuels or separately taxed supplies need their own comparison; this is not a combined whole-estate electricity and gas bill.

Example Day Preparatory School is an invented charitable company. Its example requirement is 180,000 kWh over 365 days. The activity map includes teaching, nursery, after-school clubs and occasional lettings. Those activities prompt a review; they do not establish a VAT classification. The arithmetic deliberately assumes 20% supply VAT, 20% direct-service VAT and 80% recovery. It is not a model of a qualifying bill during the temporary electricity relief period.

Establish the buyer and the buying brief

The bursar records the charitable company as proposed legal customer and asks the clerk to confirm the financial delegation and authorised signatory. A short procurement-status review is retained. Independent status does not itself answer the statutory question. The governing document, interests of the charity and any relevant procedure still need to be addressed.

The estates colleague checks the meter list, opening hours and notice deadline. Nursery and holiday activity are recorded separately from the normal teaching timetable. The board wants a manageable agreement while it reviews how the site is used. Historical consumption is supplied with the known gaps rather than described as a guaranteed future requirement.

Commission the support before accepting offers

For this fictional exercise the school chooses one lead adviser to coordinate requests against the same brief. This is a school choice, not a compulsory route. The appointment must state supplier coverage, direct fees, embedded commission, conflicts and complaint arrangements. Authority to obtain data or request offers is kept separate from authority to accept an energy contract.

Option A uses 24.00p/kWh, £3.00 per day and a £600.00 direct annual adviser fee; its illustrative term is 24 months. Option B uses 23.70p/kWh, £4.00 per day and £900.00 direct annual adviser fee over 36 months. Embedded uplifts of 0.20p/kWh and 0.30p/kWh respectively are already within the stated unit rates.

Put the annual comparison on one basis

The common annual calculation makes the recurring charges understandable. It does not make the unequal contract durations equivalent. Future renewal prices for the shorter option are unknown, and the board must assess that exposure separately. All actual exclusions and changing charges would need to be reconciled before a real comparison could be relied on.

Explain the small difference and the cash requirement

Under the fictional inputs, Option A has the lower net annual economic cost by £130.00. The lower headline unit rate in B does not offset its larger standing charge and direct fee. B also asks for a £2,500.00 refundable deposit. That money is shown separately as cash held, not added to energy expense or assumed recoverable VAT.

At the stated annual demand, embedded commission is £360.00 in A and £540.00 in B. Together with the separate direct fees, the disclosed annual adviser remuneration is £960.00 and £1,440.00 before the example tax treatment. No second addition of the embedded uplift is made. The school asks what work each remuneration package buys and whether extra visits or investigations cost more.

Test changes before writing the recommendation

A demand test reduces the annual kWh by 20%, and a separate test increases it by 15%. These are planning scenarios, not predictions about pupil numbers. Standing charges and fixed direct fees remain in the arithmetic. The school still needs written answers about use changes, quotation validity and any charge that the formula does not capture.

The specimen recommendation prefers A for its recorded annual cost, lower immediate cash requirement and nearer review point. It does not value the shorter duration as a guaranteed saving. B is retained fairly as an alternative with a longer commitment and a different renewal risk. The approved comparison must identify the actual service and contract terms that support the preference.

Record conditions and manage the first months

The proposed decision is conditional: confirm authority, complete the tax review, obtain the final written terms and check a valid price before acceptance. A bursar recommendation is not an actual board approval. The school records who may accept, how changes return for approval and where the authoritative decision will be kept.

Before supply begins, the school plans opening readings, the agreed charge schedule and a first-invoice check. It has not completed those checks in this example. During the term, a named colleague will review bill exceptions and the adviser will explain the agreed reports. The blank decision paper and working records let a school replace this specimen with its own evidence.