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Switching Energy Suppliers: A Guide For Small Businesses

We speak to hundreds of business owners every day, working in every type of business and they all have two things in common.

  1. They are very very busy and
  2. They can’t make head nor tail of their energy bill.

Sound familiar? One of the easiest ways to save money for your business is often the most overlooked – and it isn’t your fault! For years, energy companies have been automatically renewing small business energy contracts for up to three years, without the business owners knowledge. And why would you notice? As long as the lights come on, and the bills are paid, all is well!

Are you stuck on a default tariff?

Energy companies have been known to be very tricky in the past, and often make life difficult for smaller businesses. It probably won’t surprise you to learn that 45% of small businesses are on a default energy tariff. And surprise, surprise, this isn’t the one that will save them the most money. And if you think that’s a sneaky move, switching energy suppliers can be equally as tricky. In the past, it has been common practice for energy companies to make it very difficult for you to get out of their contracts. They might only give you a very brief window to cancel your plan at the end of a contract, or ask for unreasonable notification, such as requesting notice in writing, sent recorded delivery. And if you fail to jump through these hoops, you can find yourself on a three-year contract that you didn’t want or ask for.

What are the new rules for business energy?

Anyone can see this simply isn’t fair for small business owners. Therefore, new rules were introduced in 2015 to make life easier for SME business owners. If you’re running, what energy companies call, a ‘microbusiness’, you should now benefit from these new rules. The maximum notice period has been reduced from 90 to 30 days, and your supplier now has to get in touch 60 days before the end of your contract to let you know you’re up for renewal. They should outline the details of your current plan, how you are currently using energy, and how your new plan stacks up against the old one regarding savings.

Do I qualify as a microbusiness?

According to Ofgem, a microbusiness is defined by the size, turnover and energy usage.

Employs fewer than 10 employees (or their full time equivalent) and has an annual turnover or balance sheet no greater than €2 million, or Consumes not more than 100,000 kWh of electricity per year, or Consumer not more than 293,000 kWh of gas per year.

That sounds like me, what next?

According to an Ofgem report, small business owners are losing £500 million per year by staying on by default and getting caught up in auto-renewals. If you’re ready to start seeing some savings, your best bet is to seek the advice of a specialist business switch advisor. We specialise in helping you make the most of your buying power in the renewal period, so we can get you the best deal. If you’re up for renewal, get in touch with our friendly team and we’ll guide you through the process.


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Electricity, Gas