Ofgem, the energy industry regulator, warns small and medium sized enterprises (SMEs) that not switching their energy providers regularly (“not being active customers”) puts them in danger of getting worse deals than those businesses which do.
There are over 11,000 business gas and electricity tariffs and the difference between the cheapest and the most expensive rates is enormous. The most expensive business electricity rate this year has been recorded at 32p per unit, while the cheapest rate (which is applied when switching providers) is 7.5 pence per unit.
Roll Over Contracts
Business energy contracts are designed to be automatically renewed by the supplier; they are created to “roll over”. Some business electricity and gas suppliers renew about 90% of their customers without informing them and they take the opportunity to increase their rates.
Suppliers frequently require a written termination letter as part of their contract termination procedure. Each provider has different termination rules and their “termination window periods” are usually missed by customers who wish to switch. Providers allow very short termination windows, sometimes they only are 30 days long, and they can be closed as long as 90 days before the end of a contract.
Avoiding “Roll Over Contracts”
Before shopping around for better business electricity and gas prices SMEs need to be in a position to terminate their current contracts, otherwise they won’t be able to benefit from other providers’ rates.
There are two ways in which you can avoid getting your contract rolled over.
Contact the supplier directly
You’ll need to give your provider your supply numbers: MPR is your 10 digit number for your business gas and MPAN will be a 21 digit number for your business electricity. You can find these numbers on your bills. These numbers provide information about your consumption and the type of user you are.
You’ll then be able to find out the information you need to terminate your contract with them: i.e. the date your contract expires & the notice required to terminate it.
For information on how to write the termination letters to your supplier, read this complete guide.
Authorising a business energy switching service to do it on your behalf
We recommend using a business energy switching service like Make It Cheaper, because they’ll find out your renewal date, compare the energy market to find the best rates for you and will handle the switching process for you.
Thousands of businesses call this service to get help with their contract termination processes. The great advantage of using Make It Cheaper is the average savings customers can get: £1,500 pa.
Switching providers is easier than you think
It is difficult for SMEs to find the time to deal with all the obstacles business energy suppliers put in place to extend their customers contracts. However, there is a solution for those SMEs who wish to save on their energy bills and don’t want to spend unnecessary time solving the problem. Make It Cheaper is a free service that aims to lower UK SMEs’ business energy bills and to help them by taking on the hassle of liaising with providers on their behalf.