Most engagement agreement disputes I have seen or heard about come down to one undefined word.
"Savings" seems obvious until the money shows up. Then you find out the client understood it as the reduction against last month's bill, and you understood it as the differential against what would have been billed absent your work. In a year with a rate increase those are different numbers, and one of them can be negative while your work was worth thousands.
Terms worth defining explicitly.
The baseline. Which period, which determinants, and whether it is weather-normalized. Say it in the agreement.
Whether savings are measured before or after tax and surcharges. A delivery-side correction reduces the tax base too. That is real money to the client and it should be in the calculation.
The measurement period and its start date. Start from the first full billing cycle in which the correction appears, not from the date of your report.
What happens to a credit the utility applies against a future balance rather than paying out. This is common and it is not obviously a refund or obviously a saving.
What happens if the client sells the property or closes the account mid-period.
Who calculates the savings figure and what the other party can do if they disagree with it.
None of these are difficult to write. They are only difficult to negotiate after the money exists.
"Savings" seems obvious until the money shows up. Then you find out the client understood it as the reduction against last month's bill, and you understood it as the differential against what would have been billed absent your work. In a year with a rate increase those are different numbers, and one of them can be negative while your work was worth thousands.
Terms worth defining explicitly.
The baseline. Which period, which determinants, and whether it is weather-normalized. Say it in the agreement.
Whether savings are measured before or after tax and surcharges. A delivery-side correction reduces the tax base too. That is real money to the client and it should be in the calculation.
The measurement period and its start date. Start from the first full billing cycle in which the correction appears, not from the date of your report.
What happens to a credit the utility applies against a future balance rather than paying out. This is common and it is not obviously a refund or obviously a saving.
What happens if the client sells the property or closes the account mid-period.
Who calculates the savings figure and what the other party can do if they disagree with it.
None of these are difficult to write. They are only difficult to negotiate after the money exists.