Your business energy switch

Switching business energy suppliers can seem like a complex task, but it is a vital step for UK businesses aiming to manage costs and enhance their energy strategy. By taking the right approach, you can secure better deals and align your energy consumption with your business objectives. This guide will break down the process, offering practical advice to help you make informed decisions.

It is important to note that Fuse Energy currently supplies residential energy only and does not offer business or commercial energy supply at this time. This guide is for informational purposes for businesses.

Why consider a business energy switch?

Many businesses remain with their current energy supplier out of habit or a perception of complexity, potentially missing out on significant benefits. Actively reviewing your energy arrangements can lead to tangible improvements for your bottom line and operational efficiency.

Potential for cost savings

The most immediate and often compelling reason to switch business energy suppliers is the potential for cost savings. Energy prices fluctuate, and new tariffs are regularly introduced. By comparing offers, businesses can typically save money, with potential savings varying based on consumption and market conditions. Staying on an outdated or automatically renewed contract often means paying more than necessary. Many business energy contracts include a 'deemed rate' or 'out-of-contract' rate, which is typically significantly higher than negotiated contract rates, sometimes 50 to 80 per cent more expensive. These rates apply when a business uses energy without a formal contract, such as after moving into new premises or when an existing contract expires without a new agreement.

Access to better customer service

Beyond price, the quality of customer service can significantly impact your business. A responsive and helpful supplier can make a difference when issues arise, from billing queries to technical support. Switching can provide access to suppliers known for their reliability and support, ensuring your business operations run smoothly.

Aligning with business objectives

Switching energy suppliers allows businesses to align their energy choices with broader objectives, such as sustainability goals or a desire for greater budget certainty. Many suppliers now offer green energy tariffs, helping businesses reduce their carbon footprint and enhance their corporate social responsibility profile.

Preparing for your business energy switch

A successful business energy switch begins with thorough preparation. Understanding your current situation and gathering the necessary information will streamline the process.

Understanding your current contract

Before considering a switch, review your existing energy contract details carefully. Pay close attention to your contract end date and the required notice period. Business energy contracts can range from 1 to 5 years in length. Businesses typically need to provide 28 to 120 days' notice to terminate a contract without penalty, depending on the supplier and contract terms. Failing to provide notice within this 'renewal window' can lead to automatic renewals or being placed on expensive out-of-contract rates.

Gathering essential information

To get accurate quotes, you will need specific information about your business's energy supply:

• Meter Point Administration Number (MPAN) for electricity or Meter Point Reference Number (MPRN) for gas. These unique identifiers can be found on your energy bills.
• Annual consumption data: This helps suppliers understand your usage patterns and offer tailored tariffs. Your current supplier can provide this.
• Business details: Company name, address, and VAT number (if applicable).

Identifying your business energy needs

Consider what matters most to your business beyond just the unit price. Do you need:

• Budget certainty through a fixed-rate tariff?
• Flexibility with a variable tariff?
• Green energy options to meet sustainability targets?
• Specific customer support features or account management?

The step-by-step business energy switching process

Once prepared, the switching process involves several clear stages.

Comparing business energy deals

Compare quotes from multiple business energy suppliers. You can do this directly or use a reputable energy broker. Brokers can access a wider range of deals and handle much of the comparison work for you. Ensure any comparison considers the total cost, including unit rates, standing charges, and any other fees.

Choosing your new supplier and tariff

Look beyond the headline price. Evaluate the contract terms, customer service reputation, and the supplier's reliability. Consider whether a fixed-rate contract, which locks in your unit rate and standing charge for the term, or a variable-rate contract, where prices can change with market conditions, best suits your business.

Initiating the switch

Once you have chosen a new supplier and tariff, they will initiate the switch on your behalf. This involves contacting your current supplier and arranging the transfer. You will typically need to provide a Letter of Authority (LoA) if using a broker, or directly authorise the new supplier to act.

What to expect during the transition

The switching process for businesses typically takes several weeks, often between 2 to 4 weeks from the point a new contract is agreed. It is important to note that the 5-working-day switch guarantee applies only to domestic energy customers, not businesses. Your new supplier will keep you informed of the progress. Your energy supply will not be interrupted during the switch.

Key considerations for businesses

Navigating the business energy market requires understanding specific regulations and contract types.

Micro-business protections and rights

Ofgem, the UK's energy regulator, provides enhanced protections for micro-businesses. A business is generally defined as a micro-business if it meets any one of the following conditions:

• Employs fewer than 10 people (or their full-time equivalent) AND has an annual turnover or balance sheet of £2 million or less.
• Uses less than 100,000 kWh of electricity per year.
• Uses less than 293,000 kWh of gas per year.

These protections include clearer contract terms, shorter notice periods for contract renewals, and easier access to price information. For example, micro-businesses cannot have a rollover contract for more than 12 months.

Fixed vs variable tariffs

• Fixed-rate tariffs offer price certainty, as your unit rate and standing charge remain constant for the duration of the contract, typically 1 to 5 years. This helps with budgeting and protects against market volatility.
• Variable-rate tariffs mean the amount you pay per kWh can change, often with one month's notice, reflecting wholesale market conditions. These offer flexibility but less budget predictability.

The role of energy brokers

Energy brokers can simplify the switching process by comparing deals from multiple suppliers and handling administrative tasks. They can be particularly useful for businesses with complex energy needs or those lacking the time to conduct extensive research. Always ensure you understand how a broker is compensated.

Early termination fees and notice periods

Early termination fees can apply if a business switches supplier before their contract end date. This makes reviewing your contract's terms and notice period a critical first step. Providing timely notice within your renewal window, which can be between 28 and 90 days before your contract ends, is essential to avoid these fees or being rolled onto expensive rates.

Making an informed business energy decision

Empowering your business means making strategic energy decisions that go beyond immediate cost savings.

Evaluating supplier reliability and support

A cheap tariff is only beneficial if backed by reliable supply and responsive customer service. Research potential suppliers' reputations for service quality, technical support, and how they handle issues. Consider their communication channels and account management options.

Considering green energy options

Many businesses are increasingly prioritising sustainability. Look for suppliers offering tariffs backed by renewable energy sources. This not only contributes to environmental goals but can also enhance your brand image and appeal to eco-conscious customers.

Future-proofing your energy strategy

The energy landscape is constantly evolving. Consider suppliers who offer innovative solutions or have a clear vision for future energy technologies. While Fuse Energy currently supplies residential energy only, we are building a superior energy solution for the future. Businesses interested in future commercial offerings can join our waitlist to stay informed.