Your business energy contract does not behave like the one at home. It runs for a fixed term, you usually cannot walk away in the middle of it, and there is no cooling-off period once it starts. Get the renewal wrong and you can sit on the most expensive rates your supplier offers. Here is how the timing works and how to keep your unit rate fair.
Business energy is not like your home supply
Domestic energy comes with consumer protections that commercial contracts do not. Two differences catch business owners out most often.
A fixed term you are tied to
A business contract is agreed for a set period, often one to five years, at a unit rate fixed for that term. Unlike a home tariff, you generally cannot switch away part-way through. The supplier has bought energy to cover your usage for the full term, so leaving early is either blocked or comes with a charge. Plan around the end date, not around the day the price starts to annoy you.
No cooling-off period
With a home switch you get 14 days to change your mind. A business energy contract has no such cooling-off window in most cases. Once you have agreed it, by phone or in writing, it stands. That is why it pays to compare before you sign rather than after.
The renewal window, and why acting early matters
Suppliers let you agree a renewal ahead of your current contract ending, often up to around 12 months before. That sounds early, but it works in your favour. The unit rate you are offered tracks the price suppliers pay on the market, and that price moves daily. Fixing a rate while the market is calm protects you from a spike later. Leave it to the last fortnight and you take whatever the market is doing that week.
For example, a small shop using 20,000 kWh of electricity a year feels a 5p per kWh difference as 1,000 pounds a year. On a three-year deal that is 3,000 pounds decided by the rate you fix, not by how hard you shop on the day you finally get round to it.
Paying too much for business energy?
We compare suppliers and switch you off expensive out-of-contract rates, timed to your renewal.
What happens if you do nothing
If you let the contract lapse without agreeing a new deal, you do not simply carry on as before. You fall onto one of two default arrangements, and both are dear.
- Deemed rates. If you take energy with no contract in place, for example after moving into new premises, you are supplied on deemed rates. These are the supplier's standard prices, set high to cover the risk of an unpriced customer.
- Out-of-contract rates. If your fixed term ends and you have not renewed or given notice, you roll onto out-of-contract rates. These are typically the most expensive tariff a supplier has, often well above the rate you could have fixed.
Neither is a penalty for bad behaviour. They are simply the prices that apply when nobody has agreed a rate, and they are the reason a forgotten renewal can quietly cost thousands.
Giving notice the right way
Many business contracts expect you to give notice that you are leaving or renegotiating, otherwise the supplier can renew you automatically. Check your contract for the notice terms, which are often a set window before the end date. Miss it and you can be locked into another term or dropped onto out-of-contract rates. Put the end date and the notice date in the diary the day you sign, so neither creeps up on you.
How reviewing early keeps your unit rate fair
A review well before the end date does three things. It tells you exactly when your term ends and when notice is due. It lets you compare the market while you still have time to act, rather than under pressure. And it gives a broker room to approach suppliers, present your usage profile and negotiate, instead of grabbing the first renewal quote that lands.
That is the part we handle. We read your current unit rate and standing charge, look at your usage across the year, and put your profile in front of suppliers to fix a rate that matches how you actually use energy. If you want to see how the renewal step works, our contract renewal page walks through it, and you can compare the wider picture on our business energy page.
The bottom line
Business energy rewards the organised. Note your end date and your notice date, start comparing up to a year out, and never let a contract lapse onto deemed or out-of-contract rates. A short review while you still have time is the difference between a fair unit rate and the priciest one on the supplier's book. If you would like us to check your upcoming renewal, we are happy to look. Read more articles.