When New York deregulated its energy market in 1999, Margaret Carey knew it was time to go on her own.
Carey that year started MC Energy Services L.L.C., an energy services consulting company she initially operated out of her Cross River basement and now from an office in Valhalla. Carey helps her commercial clients navigate the deregulated market and find the best energy company for them.
“Our job is to understand how to use energy,” said Carey, who has about 200 clients throughout the country. “It”™s all about data. We are constantly tracking the market.”
MC Energy developed systems to track the carbon footprint of clients to ensure they use energy efficiently. Many of her clients own and lease properties and want to be as lean and green as possible.
“Corporations want to know how sustainable they are and what their carbon footprint is,” Carey said. “We track all their paper, cardboard, their miles system. We track how often they use mass transit, ride their bikes. Anything that has a carbon tag, we have a system that tracks it.”
Carey completed graduate school as the country endured the twin 1970s oil crises. After writing her thesis on Consolidated Edison Inc. she landed a job at Cushman & Wakefield Inc., where she worked in finance.
When New York deregulated, she was ahead of the curve and decided it was time to start her own business.
“With great confusion comes great opportunity,” Carey said. “People wanted to know what deregulation was. How do I navigate it? What are the risks and opportunities?”
Carey said embracing deregulation meant energy companies embraced the environmental movement, and companies were incentivized to reduce their carbon footprints and produce cleaner-burning power plants.
“In New York people were incentivized to switch from Con Edison and NYSEG (New York State Electric and Gas Corp.) and shop for an alternative supplier,” Carey said. “You”™d be plum dumb not to. If you were given a tax incentive or tax abatement, you should shop.”
The energy market is very volatile, said Carey, particularly the electric market.
“We navigate those markets,” Carey said. “We match a pricing product to the risk preferences and operational preferences of those companies. If a company truly wants to save money, it”™s going to be riding the market.”
Carey said it is important to always monitor the weather, which is uncontrollable, and legislative issues. In 2015, 8 percent of all coal-burning plants will shudder, which will impact pricing.
In supply-constrained territories like Westchester and Fairfield, Conn., counties, electric rates will likely increase.
“We figure out what”™s coming down and we attempt to mitigate the risk,” Carey said. “We”™re supposed to be the smartest people in the room.”
People have become more environmentally conscious over the last 10 years, Carey said, as concerns grow about climate change.
“People track their energy usage,” Carey said. “Ten years ago, nobody had a sustainability department or worried about carbon footprint. Now there are organizations reporting on it.”
In Europe, a company”™s carbon component can impact its stock price. People everywhere are embracing green. Carey said tenants will pay more to be in a LEED-certified building that embraces sustainability and recycling.
“You need to be more energy efficient than the guy across the street,” Carey said. “Owners are embracing it and tenants are sharper. Young people want to work with companies doing good. Right now, being energy efficient is good business. We”™ll see if that is sustainable.”
Since the market collapse in fall 2008, energy prices have trended downward. The energy market dropped 45 percent, bottoming out in April 2012, with prices remaining stable since then. Carey doesn”™t think that is built to last.
“It was great for consumers, but I see prices starting to rise,” Carey said. “I don”™t think we will see the tremendous increases we saw eight years ago, but there will be an increase.”
The unknown factor is natural gas. The U.S. has the largest supply of natural gas, though how to extract it has become a hot-button issue that does not look to be resolved soon. Many environmentalists oppose hydrofracking of gas-rich shale. Hydrofracking is not currently permitted in New York; Pennsylvania has embraced it.
“It”™s an interesting twist to what”™s going on,” Carey said.
Carey said everyone should be out in the market buying energy now and should be aggressive in case the market becomes volatile.
“Even if you have a contract that goes through the end of the year, buy now for 2014-2015,” Carey said.
