Energy costs are a necessary part of business, but every entrepreneur wants the freedom to choose the best tariff
Ask any entrepreneur whether they’d like to spend less money, and chances are the answer will be yes.
Energy costs of one of the biggest costs facing new and small businesses, but shopping for a better tariff can help you lower these costs significantly.
However, an independent study found that less than half of businesses review their energy prices annually, and one in five only review them every 2-5 years. What’s more, one in 10 businesses never shop for a better energy deal.
So why is switching so important for businesses, and when can you do it?
When can you change your supplier?
You can switch your business energy supplier when your contract’s switching window opens. This is the time period – determined by your supplier – in which you are allowed to renew your contract or switch to a different supplier.
The length of your switching window will depend on your current provider, as it can range from 30 days before your contract ends to four months.
Make sure you check with your supplier so you know when your switching window opens. That way, you’ll avoid fees for switching delays.
Why does Ofgem want you to switch contracts?
Four words: Out of Contract rates. These are imposed once you’ve come to the end of your agreed contract with a supplier, if no further tariff has been agreed upon. In other words, if you just do nothing and let your contract roll over, you’ll end up paying these rates.
These imposed rates are much higher than contracted energy rates, and Ofgem warns businesses that contractors do very little to get you moved onto agreed terms. Should you still switch if you’re happy with your current supplier?
You might have no qualms with your current energy provider, but it’s still worth shopping around during your switching window, even if it’s just to have a look at what else is out there.
By comparing tariffs, you’ll get a better idea of how your current deal stands up against the competition. And if you still decide that you like your current supplier, you can see if there is a better deal available under that provider.
It’s also possible to negotiate on business contracts as you shop around – and that’s where our team of energy brokers come in. Find out more on 0191 691 18 02.
Can you change before the switching window?
Yes, but it might cost you. If you want to switch you supplier before your switching window has opened, chances are you’ll have to pay a cancellation fee which might be quite significant. So make sure the savings you’d make by cancelling are greater than the price you’d have to pay your current supplier.
For microbusinesses, you can provide a termination notice at any point in your contract, even though the switch won’t actually take place until the contract is up.
What if you’re moving locations?
If you’re moving offices, you’ll already have plenty to think about, but you should try to organise a new energy contract ahead of your moving date. However, you will need to provide a specific date, otherwise you risk being placed on Deemed rates, which are similar to Out of Contract rates but slightly less expensive.
In any situation, it’s best to seek out the advice of energy experts who can provide insight into the best course of action for your specific situation. That way, you’ll give yourself the best chance of a great new deal.
Start comparing business energy tariffs today with The Energy Check. Simply click here to find the best deal for you, or get in touch by calling 0191 691 18 02.