See our handy hints & tips to help you through your next energy procurement process.
Choosing a supplier
There’s a large number of companies supplying gas and electricity to businesses in the UK. Not all suppliers have the same fixed and flexible contracts, and some itemise their bills differently meaning you can’t always compare like for like. Whilst pence per unit (PPU) is an important factor, there are a number of other key considerations to take into account.
Understand what your supplier's offering
Some suppliers may offer fixed and flexible contracts depending on your power consumption. Take some time to research what is available and the kind of contract that will work best for your business.
Ask about how accurately bills are produced
Most suppliers report their statistics and there's nothing more important than paying the correct charges. If you're a small business think about installing a smart meter to avoid estimated bills and ensure a high level of billing accuracy.
How do energy contracts work?
It’s important to understand the terms of your contract. All fixed contracts have an end date, but often if prices are advantageous you may be able to renew your contract many months ahead to secure a better price. It's good to check if your contract has a notice period and how far ahead you're able to renew.
Fixed or flexible?
A standard fixed contract, in most circumstances, guarantees your energy prices won’t change during the fixed term, allowing you to budget for your energy. This could be advantageous if the wholesale energy market is low on the day you agree your contract, or in a rising market. A flexible contract still offers you price certainty but allows you to buy energy in smaller chunks or review prices mid-contract, in a declining market this could be particularly advantageous. If you are a Small business often the choice is between a Fixed or Variable Plan. If you use more power, and energy is more strategic to your business, there tends to be a wider range of choices.
When you look at energy more strategically you may discover that you can cut costs by investing in additional energy solutions, when negotiating your energy contract remember to enquire about the following solutions:
When energy suppliers cease trading, the regulator Ofgem intervenes and the customers are passed to an alternative supplier. During this period prices may change and there's upheaval for the customer as there's a forced change of supplier. For businesses, any credit held with the old supplier is not automatically protected.
For your own reassurance, you can view the financial performance of any prospective suppliers at GOV.UK.
Considering how your supplier may handle, manage and resolve complaints effectively is an important part of the decision-making process.