Redeem your business energy rights – what to do with deemed contracts

When assuming control of a new premises, it is good to inquire about the premises’ existing energy contract from the current energy supplier.

Rolling into a new building for your small business is an exciting moment. 

Before you start consuming energy in your new premises, it behoves you to inquire about the current business energy contract in place. (Assuming you have not already switched the supplier for your relocated business. In this case, you are already set!) You do not want to be caught in an expensive or otherwise unfavourable business energy contract. According to Ofgem, deemed contracts on average cost customers 80 per cent more than contracts freshly negotiated. 

Thankfully, you are afforded rights in the UK to request everything you need to know about the current energy contract and to freely switch to a new one without burdensome red tape. Before looking into that, let’s define a deemed contract formally and how they are put into place.

What is a deemed contract?

A deemed contract is enacted when a customer moves into a new premises and uses its gas and electricity – or just one or the other – without negotiating and agreeing to a contract with the supplier. 

Another way that these contracts can begin to exist is when the existing energy contract ends but the customer still uses energy. This can happen in two ways:

  1. The supplier or the customer terminates the contract, but the premises is still supplied with energy by the supplier.
  2. The contract expires, but the customer continues to consume energy from the same supplier. 

What you can do about deemed contracts

There is no reason for you to be in the dark about a deemed contract that you may be in. You are afforded the right to inquire about the contract in place and its terms and other details. 

Here is what you can do:

  • You can ask for a copy of the full contract from the energy supplier if you have taken on a deemed contract. Energy suppliers are obligated to provide this to you and to provide you with the principal terms of the contract, including any charges or fees. 
  • You can switch to a new supplier for any reason and at any time. The supplier cannot prevent you from switching, not even for reasons of debt or contract. They also cannot require you to give notice before terminating. You should not have to pay any termination fees either. 

What the supplier must do when you’re on a deemed contract

In addition to providing the full contract when requested and allowing you to switch suppliers with no strings attached, the energy supplier issuing the deemed contract must do the following:

  • They should inform you about other available contracts and how you can receive information about these contracts. 
  • The energy supplier should endeavour to ensure the terms of the contract are not unnecessarily burdensome to you. A contract is viewed as “onerous” – in the eyes of Ofgem – if the price the customer pays for the electricity significantly exceeds the costs to supply electricity to the building. 

Switch to a new contract now

As mentioned earlier, deemed energy contracts are often more expensive than ones that are newly negotiated. If, after you have reviewed the terms, fees, and charges of the contract that you requested to receive, you are ready to switch energy suppliers, head to BusinessEnergyQuotes.com and browse quickly for your new, cost-saving gas and electricity contract. All you need is your postcode or meter number and your monthly spend and current plan end date to see a raft of the best deals in the UK.

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