Understand the invented group and the limits

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 Independent Schools Group is an invented commercial parent with a separate contracting subsidiary. Campus One is a day school; Campus Two combines day and boarding provision. The illustrative annual model uses 1,200,000 kWh over 365 days, 20% supply and service VAT and 90% VAT recovery. These are deliberately simplified fictional inputs. They do not establish the status, recovery or tax treatment of any real group.

Identify which entity will be bound

A common brand and central purchasing team do not establish that every campus or subsidiary can join the same agreement. The finance director records each proposed supply point, customer entity, current agreement and signatory. The group checks company authority, any charitable entities involved and whether public-procurement rules are relevant to the actual buyer.

The board is considering a change in the estate. The requirement therefore asks what happens on a campus sale, new site, legal-entity change or reduced operation. The group obtains written supplier answers instead of assuming a transfer will release the old customer. Guarantees, deposits, joint liability and other security terms need distinct approval where proposed.

Use one coordinated requirement and disclose the fees

For this fictional exercise the group appoints one lead adviser with a bounded data and quotation mandate. The contracting subsidiary retains acceptance authority. The adviser identifies supplier coverage, connected interests, the basis of comparison and tasks handled by internal staff. A central appointment does not remove the need to procure or approve the separate supply agreement appropriately.

A offers 24.10p/kWh, £16.00 daily standing charges and a £2,400.00 direct annual fee over 24 months. B offers 23.90p/kWh, £19.00 per day and a £3,000.00 direct fee over 48 months. Embedded uplifts of 0.20p/kWh and 0.30p/kWh are already included. Both offers are fictional and assume the stated charge basis only.

Put annual expense and cash held side by side

The same demand, 365-day period and illustrative tax inputs are used for both options. Deposits remain outside energy expense. The annual view does not price years three and four of a future A renewal, so it cannot establish a four-year saving against B.

Evaluate a close financial result

At baseline, B has the lower net annual economic cost by £719.10. A asks for a £10,000.00 refundable deposit and B £20,000.00. The board sees the cost difference alongside the extra cash held, security conditions and the planned estate decision. A refundable amount is not described as a permanent saving.

At the stated demand, annual embedded commission is £2,400.00 in A and £3,600.00 in B. Including the separate direct fee, annual disclosed remuneration is £4,800.00 and £6,600.00 before the example tax treatment. With unchanged demand and fees, illustrative remuneration over the offered terms would be £9,600.00 and £26,400.00. Different durations must remain explicit; those figures are not comparable service values without the underlying delivery and future requirements.

Test the estate change and retain uncertainty

The group tests demand at 30% below baseline and 20% above it. The formula changes variable use while retaining the stated standing and direct fees. Those are arithmetic scenarios only. Supplier agreement to site changes, allocation of shared charges and any exit or volume adjustment remain outside the complete price until written terms establish them.

The specimen recommendation prefers further assessment of the shorter A option because it aligns with a nearer estate review and ties up less cash. It records the £719.10 higher annual net calculation rather than concealing it. The board must decide whether the documented flexibility and timing reasons justify that difference. No invented monetary saving is assigned to an unpriced risk.

Bring the conditions to the correct decision makers

The recommendation remains conditional on final entity and signatory checks, a written site-change process, security approval, tax review and a valid final offer. If the written terms do not support the rationale, the recommendation must return to the board. The page does not turn a preferred option into an actual approval.

The management plan records a named lead at each campus, a group owner for bills and adviser performance, opening evidence and a first-invoice review. Annual comparisons will be reconciled with actual charge periods and consumption. Any acquisition or disposal triggers a contract review. The continuing service should leave the group able to access its own data and manage the next renewal when people change.