Published on 01/11/2019
Energy contracts can be daunting for even the most seasoned business owner, but it's well worth getting to grips with yours so you can be sure you understand precisely what you're signing up to.
With this in mind, we've written a short guide for Microbusiness and SME customers to walk you through the key points.
In most cases, business energy customers sign up to a Fixed Term Contract and pay a fixed rate throughout its duration, which could be anything from one to five years or more.
When you receive the details of your contract, you should check the rates to make sure they match up to what you were expecting. Once your contract is signed, it's unlikely these rates can be changed.
While you're checking your rates, take the time to double-check the rest of the information in your contract. If anything is inaccurate, make sure this is updated before you sign on the dotted line.
Unlike domestic energy contracts, business energy contracts do not include a Cooling Off Period. This means that from the moment you sign, you're bound by the terms of the agreement. All the more reason to spend time making sure you know exactly what you're signing up to.
Payment terms should be clearly outlined in your contract. Make sure the payment terms you're expecting are detailed in your agreement before you sign. If you need to change these terms after you sign, you could be moved to a different tariff which could be more expensive.
Check the terms of your contract for any additional charges that could be applied to your account. Usually, these will be because of failed or cancelled payments, but could also cover costs incurred due to disconnection or reconnection of supply.
In some cases, a supplier may ask a customer to provide a security deposit. Deposits are often required from customers who have a poor credit or payment history, meaning there is an increased risk that they could fail to pay their bills. In most cases, the deposit will be paid back at the end of the contract, less any money owed to the supplier.
The contract you sign is for the supply of energy to your property, not you personally, so if you move out of the property, your contract will end.
When this happens, we request supporting information to evidence that the move has taken place and that you are no longer responsible for the property. Unfortunately fraudulent 'Change of Tenancy' cases are all too frequent, so it's crucial we're able to confirm that the move has taken place.
You can terminate your contract at any time, however you'll need to read your terms and conditions to find out what steps you need to take.
In most cases, you'll be asked to give 30 days notice of your termination. Also, you'll probably be expected to pay a termination fee, which is typically equivalent to the cost of 6 months' energy consumption, based on your previous energy use.
Around 60 days before your contract ends, you'll receive a Renewal Notice and a Statement of Renewal Terms, which will clearly outline the options you have when your current contract expires. You can choose to accept these terms, or if you decide to move to another supplier, you'll be asked to give notice (usually 30 days) of your intention to leave at the end of your contract.
If your contract ends and you haven't signed a new contract, you'll automatically move to Out of Contract Rates. These rates will typically be more expensive than the rates you were paying under your fixed term, so it's essential you agree to a new contract, so you don't pay too much for your energy.
If you have any questions about your current energy contract, or would like to find out if you could get a better deal on your energy with HUB energy, please visit our business energy page, or why not get in touch?