Businesses overpaying on energy by not switching
The Competition and Markets Authority (CMA) is investigating the business energy market and its 2015 findings suggest that a lack of competition in the market in 2009-13 meant that SME customers of the big six suppliers were paying 14% above competitive levels for their energy, costing them £0.5bn a year more than was necessarySean Davies, Gocompare.com
How can we help you with your business energy needs today?
Utility bills are likely to be a major outgoing for your firm, yet many business owners get stuck in a cycle of auto-renewal of energy-supply contracts that may be costing them thousands of pounds.
If you've never switched or you stick with the same supplier for a long time, the likelihood is that you'll have moved towards the most expensive of their tariffs and you're potentially paying far more than you need to.
Domestic energy users are increasingly familiar with this pattern, but the percentage differences paid by business customers may be even more extreme.
Looking around for a better deal that could save money is easy with Gocompare.com and our partners Make It Cheaper who offer a personalised, independent and impartial service to help you find the right option. They will:
- Guide you through the switching process
- Advise on any action that needs to be taken
- Provide a direct phone number to an adviser who can field your questions
- Offer a free, no-obligation comparison of all business gas and electric suppliers
How do I compare and switch?
- Find a recent bill
- Either call 0800 326 5556 (calls should take no longer than 10 minutes) or click the "Call Me Back" link above and complete the short form to request a call back
- You'll be quoted the best rates over the phone and by email
- If you choose to proceed, Make it Cheaper will organise the contract with your new supplier
- The switch over to the new contract should take four-to-six weeks
- There'll be no paperwork and no disruption to your supply
The potential savings could be significant, as indicated by the Competition and Markets Authority (CMA) which is investigating the business energy market.
In its preliminary findings - announced in July 2015 - it said that a lack of competition in the market in 2009-13 meant that SME customers of the big six suppliers were paying 14% above competitive levels for their energy, costing them a combined total of £0.5bn a year more than was necessary.
The big six of EDF Energy, E.On, SSE, Centrica, Scottish Power and RWE Npower control the vast majority of the market, but you should compare your options with each of them and remember that there are alternative, smaller firms that could potentially offer better deals and service.
It's the customers who end up doing nothing that we're probably most upset about because doing nothing means you'll get done
Jonathan Elliott, Make It Cheaper
The CMA has suggested that part of the reason for business customers overpaying is because the big six suppliers inherited millions of so-called 'sticky' customers when the energy industry was privatised in the 1990s.
Many of these customers have never shopped around and have consequently been left on the most expensive tariffs.
The most attractive prices are typically found with 'acquisition tariffs' - which are available to switchers opting to fix their supply for a year or more - while the most expensive are typically applied to 'out of contract' rates where businesses have never actively looked at their energy supply contract.
"It's the customers who end up doing nothing that we're probably most upset about because doing nothing means you'll get done," said Jonathan Elliott of Make It Cheaper.
"The energy companies need to publish their variable prices and get rid of the 30-day notice period they ask for before a switch. You can actually switch in three days so it's crackers they're asking for 30 days."
You can find out more by reading our business gas and electricity guides, where you'll also find the answers to frequently asked questions.
Our guides offer more information on key areas of business energy bills such as rollover contracts, 28-day contracts, deemed rates, the Climate Change Levy (CCL) and the factors affecting the utility rates paid by your business.
You can also read more about making the sort of green business choices that could lead to both environmental and economic benefits.