The Ultimate Guide to Business Energy

Judging from face value, ‘business energy’ might seem a simple term, since it indeed means – yes – energy used by businesses. However, if you need a new energy contract for your company, you should be wary of treating the corporate energy market too much like its domestic equivalent.

There are actually various key differences between the two – and knowing precisely where they diverge from each other can help you to land an energy deal that works well for your company in both a practical and financial sense.

You might have long been confused by a lot of the jargon attached to the business energy market, or had your fingers burnt as a result of paying over the odds for a corporate energy deal.

That’s where we come in.

Having helped many businesses across the UK claim back the excess money they have paid on energy, we are well-placed to guide you through the obstacle course that is the world of UK commercial energy.

In this guide, we’ll discuss:

• What business energy is
• How business energy gets mis-sold to UK companies
• How to claim back overpayments on business energy
• What Business Energy Claimline can do for your business

So, if you’re troubled about mis-sold business energy contracts or making a claim, you’re in the right place. Any questions or to assess your eligibility for a claim, get in touch today.

What is business energy? 

The term ‘business energy’ refers to energy sourced specifically for corporate purposes. As with domestic energy, you would buy it from an energy supplier – however, your company’s power requirements will inevitably differ to those of your household.

Of course, exactly what you need power for in your workplace will largely depend on the type of business you run. Here are just a few things for which many businesses might have to arrange energy:

• Heating
• Lighting
• Office equipment
• Production equipment

Your corporate energy costs can be influenced by a range of factors – including:

• Your company’s energy usage
• Your specific business energy contract
• The business energy supplier from which it has been obtained

In practice, a reliable energy supply is essential for the majority of businesses. As well as powering productivity devices used on a day-to-day basis, this energy can provide employees with as much light and heat as they need in order to work comfortably and, as a result, productively.

Hence, it is important that you budget effectively for your business energy bills – no matter how large or small the business. This point is especially applicable when you take into account that business energy contracts tend to last longer than domestic ones.

While a domestic energy contract is usually agreed for just one or two years, a business energy contract is likely to be between two and five years in length.

Furthermore, unlike their domestic counterparts, business energy contracts are normally ‘single-fuel’. In other words, a business energy contract will typically focus on just gas or electricity rather than cover both – meaning that you will likely need a separate deal for each.

It’s up to you whether you obtain both of these deals from the same business energy supplier or instead each contract from a different company.

In any case, you should always be very careful with how you arrange an energy contract for your business. Given the constraints placed on your work time, business energy brokers can be incredibly useful for sourcing gas or electricity deals on your behalf.

However, it’s important to note that not all brokers will put your business’s interests above their own, deliberately mis-selling contracts to reap higher commission.

If you suspect you are overpaying for your business energy, call a member of our team today.

Why is energy so important in business?

Small and large businesses alike depend on energy. Organisations in the following fields can be especially reliant on high power consumption:

• Manufacturing and production
• Technology
• Retail
• Finance
• Education
• Health and wellbeing

Naturally, larger businesses can – compared to smaller organisations – easily be faced with costlier business energy bills.

However, even if you run a relatively small organisation that rents (rather than owns) its workspace, the rental deal for it might not cover gas and electricity bills. You therefore would need to implement corporate energy supplies on your own initiative.

Through assessing your current contract, you can help yourself to ascertain whether your company is really getting its energy as cost effectively as it could. The various types of business energy contract include:

• Deemed and out-of-contract – You might be handed one of these contracts if you relocate to new business premises without formally agreeing a contract. If your current supplier fails to specify in a contract what will happen once it ends, it could become deemed or out-of-contract.
• Fixed – This kind of contract imposes, for its fixed term, a set rate per kilowatt hour (kWh) of electricity or gas. Keep in mind, however, that your business energy bills will continue to fluctuate in line with your workforce’s levels of power consumption on the premises.
• Variable – With this type of deal, market activity plays a part in what rate is charged per unit of energy. This rate would therefore be vulnerable to potential change before the contract elapses.
• Rollover – If you have a business energy contract that has no renewal provisions and runs out before you have agreed a different contract, you could end up with a rollover contract. If held by a micro-business, a rollover contract cannot remain in place for longer than 12 months.

Be warned that the type of contract you sign up for – or, for that matter, allow yourself to slip into – will have implications for what energy costs you incur. For example, deemed and out-of-contract contracts will often be among a business energy supplier’s priciest.

Why is business energy so expensive?

You need to remember that, compared to your household, your business is likely to have many more things that need energy. Any office, retail unit or headquarters your company has will need lighting and heating – and the monthly energy costs can quickly start adding up as a result.

All in all, then, enterprises do tend to spend more than consumers on energy. This is despite the fact that, ironically, the rates businesses pay per unit of energy – measured in kWh – are usually lower than the corresponding domestic rates.

Why, then, do businesses generally pay more overall on energy? One big reason is the discrepancy between what companies and households pay in VAT on their energy bills. In this situation, firms usually pay VAT of 20%, while domestic customers owe just 5%.

Corporate customers are also required to pay the Climate Change Levy (CCL), though it is worth pointing out that some exemptions apply for both VAT and the CCL. For example, a VAT rate of 5% is available to businesses that consume energy beneath a certain daily ‘de minimis’ threshold.

However, it is not only on a month-by-month basis that businesses can often find themselves needing to spend more than households on energy. That’s because, as we have acknowledged above, energy contracts for the former are typically longer.

You should also heed that business energy contracts provide fewer opportunities for switching to a new plan. For a start, most of these contracts lack the ‘cooling-off period’ that, in the case of a household energy contract, allows the deal to be cancelled within 14 days of it being agreed.

In order to leave a corporate energy contract, you would usually need to wait until a switching window, which normally won’t come along until close to the contract’s end date. Failing to act during this window could see you rolled over to a costly default contract.

You don’t even need to physically sign anything for a business energy contract to become binding. The initial agreement could be made over the phone – another reason why you could too easily find yourself getting tied to a plan higher in cost than you had expected.

Another potential complicating factor is if you arrange for an energy broker to peruse deals from multiple business energy providers in a bid to find you the ‘right’ contract. The rate you pay on it could include the broker’s fee – and consequently inflate your outgoings in this area.

How do you find the most competitive energy tariffs?

As you might have gathered from reading this article, it stands to reason that you should always be meticulous with how you decide between corporate energy packages. When comparing these, you will need to have the following details at hand:

• Your current supplier and tariff.
• How much gas and electricity your business generally uses on a yearly basis.
• Your average annual bill.
• Your existing contract’s end date.

You can find all of this information on your corporate energy bill or online account – and your eventual choice of tariff could be swayed by not only the price but also the supplier’s reputation.

Now, poring through the corporate energy market for the ‘best’ deals can be much easier said than done. While various household energy deals can be compared in just a few minutes, business energy plans are much more time consuming to peruse.

You might understandably have so many different work responsibilities on your plate that you lack the time to fetch and scrutinise a large number of business energy prices personally. This is where an energy broker could come in useful, comparing the various options for you.

Energy contract renewal offers from existing business suppliers rarely present the best value in comparison to alternatives. So, if your company is in a position to switch suppliers, this could be great news for your utility costs going forward.

Fortunately, by utilising the services of a business energy broker, you can have your cake and eat it – at least in theory. You can leave the broker to search for and find you a cheaper business energy tariff that would still meet your company’s current energy needs.

All you would need to do is provide the broker with some details about your company and then, once the broker has reported back to you, decide whether to accept the ‘best’ of the numerous deals they have unearthed for you. However, using a broker in this way is not entirely without risk…

How can business energy get mis-sold? 

A business energy broker basically acts as a middleman between business energy providers and businesses seeking to take out new energy deals. It can be very useful for you to turn to such an intermediary if you lack expert knowledge of the commercial energy market.

These brokers are already thoroughly experienced in this market and working with many of its players. A business energy broker can factor in your corporate energy needs while looking for a business energy contract that would meet them cost effectively.

Many business energy suppliers are willing to offer exclusive deals through brokers due to the high number of clients the latter are known to have. The competition between multiple suppliers working with the same broker can drive down prices of contracts offered through them.

A business energy broker can also make sure they select a contract that would save money for your organisation over the entire duration of the contract rather than just in the short term.

However, if you do use a broker to secure a new business energy contract, the broker is legally required to tell you how much money they will receive in commission as a direct result of arranging that contract.

Unfortunately, rather than meeting this particular legal requirement, many brokers will simply claim that either the service is free or they will be paid a fee by the energy supplier providing the contract. Either of these claims would be misleading to the client.

It would also be a case of the broker deliberately mis-selling a business energy contract – and this practice is illegal. Despite this, energy brokers can too often lower themselves to it due to a lack of regulation in the industry where these companies operate.

The good news is that our team here at Business Energy Claimline can claim business energy rebates for companies that have fallen victim to this scam.

How do business energy brokers operate?

As we have established, business energy brokers facilitate communication between suppliers and buyers in the corporate energy market. A broker in this field can keep your corporate energy needs in mind when looking for an energy contract that would meet them.

These brokers work with suppliers ranging from big names like British Gas, SSE, EDF, E.ON, Scottish Power and npower through to small companies, each serving a relatively small customer base. It is important to emphasise, however, that brokers and suppliers are usually separate businesses.

Typically, brokers and suppliers enter into a comprehensive ‘Introduction agreement’, pursuant to which the suppliers agree to remunerate the brokers with a commission or uplift in consideration of the brokers’ referral of clients.

As a business energy broker purchases the energy deals at lower prices than those directly available to business owners, this leaves the broker with room to add their own commission to the price without necessarily preventing it from representing the best-value deal on the market.

Let’s assume that you are offered a business energy contract where you would pay 20p per kWh of energy you use. The bill will show that you are paying this rate to the energy supplier. 

However, the supplier will pay a cut of the money – say, 2p per kWh – to the broker through which you obtained the contract. If we take the example figures we have cited above, the amount of money you would really pay for the energy itself is 18p per kWh.

Whilst doing this, typically, the suppliers may add a few pennies onto the rate, as they are aware that the broker will be earning a commission. Because of this, the clients may end up paying an uplift to the broker on an inflated energy price.

When the broker or a supplier offers you a contract, they are legally required to disclose the amount that they will make from it in commission. They need to disclose the fact that a commission will be paid, the exact amount of commission and the way the commission will be calculated.

If the broker actually attempts to hide this information from you, the contract’s price may have been inflated without your knowledge.

If this has indeed happened, it would be a case of a mis-sold business energy contract, and you may be eligible for claim. Get in touch with Business Energy Claimline today to find out more.

How do I find out if I have made overpayments?

It can be tricky to figure out – at least without expert assistance – whether you have been mis-sold business energy. However, you could watch out for a few clues. 

It would be particularly helpful for you to keep a record of how much energy your company uses on a monthly or yearly basis. That way, when your existing contract is about to run out, you could scour the energy market to see how prices on offer compare to what you have been paying.

Some brokers and suppliers attempt to conceal their fees by simply charging more than the going rate for electricity or gas. However, as your current energy supplier does not actually need to notify you when your contract is nearing its expiry date, you should proactively watch out for this yourself.

Otherwise, the contract could be inadvertently left to automatically renew itself – as, perhaps unsurprisingly, your supplier would prefer. Though they might send you a letter listing renewal prices, chances are that you won’t see it until it is too late for you to terminate the agreement without incurring any penalty.

In theory, a business energy broker should offer you a contract that, from a financial point of view, would work out especially well for you, the client. In practice, however, this contract could simply be the one that would give the broker the best profit margin. 

For this reason, you should be wary if – for example – the broker encourages you to take up a contract that seems lengthier than what you really need. It could be the case that, the longer the contract they successfully sell to you, the higher the commission they will receive on it.

Still, none of these various potential signs of a mis-sold business contract would necessarily constitute dead giveaways that some wrongdoing has actually come about on the broker’s or/and the supplier’s part. This is why you might want to directly contact our team for further expert insight.

How do I claim back overpayments on business energy? 

There is not currently any government ombudsman responsible for helping with claiming rebates on the mis-selling of energy contracts – especially those covering business energy. However, we at Business Energy Claimline can assist with closing the gap in this area.

We can tap into our legal experience as we determine whether you are indeed eligible to claim back corporate energy overpayments. To book this assessment, which we can carry out for free, please contact us by phone or using the online form on our website.

You could be entitled to a rebate – that is, a partial refund – for mis-sold business energy if you meet all of the following criteria:

• You run or work for a business.
• You are in charge of arranging energy for at least one workplace of this company.
• You have sourced gas or electricity for this business through a broker.

It’s worth noting that you could also be eligible, even if the corporate energy contract you have signed is for a serviced office where power is not already supplied.

If you do turn out to qualify, we can proceed to help you with structuring your claim. We will handle all of the necessary paperwork and, if the claim is successful, collect the money for you. All you need to do is provide us with the following items and details:

• The name of the business energy broker you used.
• Copies of your invoices.
• A copy of the business energy supply contract.
• A copy of the correspondence or/and the Letter of Authority you signed with the broker.
• Any other useful, relevant documents that could assist in strengthening the claim.

However, rest assured that, if you don’t quite have all of the above pieces, we can locate and fetch any that happen to be missing. Once we do have everything we need, we will be able to give you an approximate valuation of your claim.

At Business Energy Claimline, we offer our clients a completely transparent no-win, no-fee guarantee. If we ultimately steer your mis-selling claim to success, we will return your rebate to you – minus our pre-discussed fee. However, if you don’t win your claim, the proceedings won’t cost you a penny.

Have a read of our reviews, and discover why we’re the go-to choice for hundreds of businesses across the UK.

Is claiming back business energy straightforward?

Even if you reckon you do have a strong case against a business energy broker, you might be reticent about the prospect of taking action against them.

Perhaps your heart is sinking at the thought of sorting through and filling out reams of paperwork, or you fear getting a frosty reception when reaching out directly to the broker. However, Business Energy Claimline can save you from undertaking either of these daunting tasks.

That’s because we can take on those responsibilities ourselves – and do so time effectively, too, due to our specialist background in and expertise of the business energy market.

We have streamlined the entire process of helping our clients to claim back on mis-sold business energy, meaning that the recovered money can be in your bank account as soon as possible. To draw upon this service, all you have to do is follow the stages detailed below:

• Call us or use our online form to arrange a free assessment from our team.
• If we find that you are eligible to make a claim, let us know if you wish to proceed with it.
• Provide us with some key pieces of information we request from you.
• Wait for us to act on your claim.

How long it takes us to process your claim will depend very much on the claim and situation. The factors that can influence how long you have to wait include:

• The type of business you own or work for.
• The broker that mis-sold you the business energy contract.
• The length of the contract.
• The documents and evidence you have provided in support of your claim.

As a rule of thumb, the length of time involved in us processing a claim can be anything from a few weeks to an entire year. However, as we process the claim, we will keep the client informed about how the case is developing and progressing.

If we are successful with your mis-selling claim, our pre-discussed fee will be deducted from the rebate we pay back to you. If you don’t win, you pay nothing. It’s that simple.

Are there any exemptions?

Our legal experts here at Business Energy Claimline have helped enterprises across various industries and sectors with recovering money lost as a result of mis-sold contracts.

Quite simply, if you have used an energy broker to obtain an electricity or gas supply for a business of which you are a part, it is possible that you were mis-sold this energy and so would now be entitled to a rebate payment intended to make amends.

We do underline, however, that we only assist businesses – and so are unable to help:

• Consumers seeking to switch to a better energy deal
• Businesses renting serviced office spaces where the energy is arranged by the office owner
• Companies that have sourced energy contracts but not from a broker

We focus specifically on aiding businesses that have used an energy broker to take out an electricity or gas deal.

If you reckon that you are in something of a grey area, where you might be eligible for the business energy rebate but can’t confidently discern either way for yourself, we urge you to get in touch.

We have specialist expertise in evaluating clients’ claims for mis-sold business energy contracts, and can apply this knowhow to your own case. 

If we do reach the conclusion that you have a strong case, we can – with your approval – follow up your claim and recoup the money on your behalf.

However, even if your claim is valid, you might not be able to get quite as large a payout as you had originally expected. This could happen if:

• Your business does not consume a lot of energy
• Your company is not in a particularly energy-intensive industry or sector
• The contract length is modest by the usual standard of a business energy contract

When we value your claim as part of our free assessment, we will be able to give you an insight into how much money you can realistically anticipate this claim fetching. You can then decide, on the strength of this information, whether to go ahead with the claim.

How can Business Energy Claimline help me? 

If you are still unsure whether you are likely to have a valid business energy claim, we assure you that we have taken pains to make sure we can provide you with our expert thoughts. We won’t request any payment from you simply for us to investigate the validity of your mis-selling claim.

After you have asked us for advice on the matter, and sent us any documentation and other information that can potentially help in evidencing your claim, we will get back to you as soon as possible about whether you genuinely do have a claim.

If we decide that the broker has not mis-sold you any business energy, we will just say so, saving you from pursuing a potentially time-consuming dead end. We have years of experience on what’s required so will be able to give you sound advice on our reasoning.

However, it bears emphasis that many clients who do approach us about possible mis-selling learn that they actually have a strong case. If you suspect that this could be true for you, too, we invite you to contact us as soon as possible.

Our overriding objective here is to help you make a truly informed decision. We should also point out here that, if we do pursue your business energy claim but you don’t win it, we won’t impose any charges on you whatsoever.

As we work for our clients on a ‘no-win, no-fee’ basis, you can take heart that, in engaging members of our highly experienced and knowledgeable team, you can keep the financial risk to both yourself and your business at a minimum.

Another source of comfort about using Business Energy Claimline is that our customer service has garnered much praise from companies across the UK. 

Start your business energy claim today

Suspect you may have an eligible business energy claim? Good news – you may be able to claim back a lot more money than you had initially thought. No matter where your business is based in the UK, capitalise on our hassle-free service.

There is no set figure for how much money can be reclaimed due to mis-sold business energy overpayments. However, in the past, we have helped to secure thousands of pounds for our clients.

We have taken the fight to misleading brokers and energy companies – and, in some instances, even recovered millions of pounds for our clients. 

Our philosophy is to use our legal expertise to unravel potentially complex aspects of each claim but make it all easy for the client to digest. Throughout your entire journey with us, we will impart advice and guidance that has been tailored to meet your specific requirements.

Don’t worry if, along the way, any questions about our business energy claims service pop up in your mind, as we will be happy to patiently address any concerns you tell us you have about turning to our company.

Our service is bespoke – as well as open, honest, and transparent – all the way through. For example, before you engage us to help you with your claim, we will detail all of our fees so that you can make an informed decision about whether to proceed with using our service.

If we pursue your claim all the way through to success with landing you a refund, we will deduct our cost from this money. Conversely, if we fail to win you the claim, you won’t need to pay any money at all.

If you currently have any remaining questions about what we offer, we encourage you to reach out to the Business Energy Claimline team directly.