Could you have been missold your business gas and electricity?

Martin Lewis [Money Saving Expert] recently called the current situation a “catastrophe” with part of the blame being that the energy landscape for businesses in the UK is a very different market to residential, having many more factors, variables and demands, and although there has been an improvement in regulations, dealing with Business Energy contracts and brokers can be a daunting task.

Whilst the Government initially intervened with an eye-watering £150bn of help in the form of an energy pricing cap for households, the help provided to businesses is slightly more complex and moreover only for 6 months.

However, read on there is some light at the end of the tunnel for businesses…

Most businesses may have knowingly or unknowingly at one time or another, used an energy broker, whose role was to find a suitable and fair market rate for their energy needs.

To give you an idea of the likelihood you may have used a broker, there are just over 50 business energy providers in the UK, but over 3000 business energy brokers.

What many people don’t know is a broker can receive up to 80% of his commission upfront, and the longer the deal, the more being earnt in commission.

What became apparent over time was most of these ‘broker recommended’ contracts were simply not fair or appropriate for the business concerned, which led to Ofgem, the Gas and Electricity Markets Regulator, promising a strategic review of practices in July 2020, and on the 28^th March 2022, finally announced its long awaited decision.

Ofgem identified that businesses were often tied into long term contracts on rates that were far higher than they should have been. The lure of a lower rate than they were currently paying was enough for most companies to sign on the dotted line, when they could have actually been offered lower rates still.

Brokers also received commissions from the energy providers based on the margin that was being made and the length of the contract signed but were not required to disclose these commissions to the customers. In a nutshell, it was common practice for brokers to recommend the contract that gave them the best return but not necessarily the best deal for the business owner.

The good news is brokers are now required to provide full contractual terms, including details of the amount of commissions paid to them and also any other charges.

In addition, energy providers will also require all brokers to be registered with a qualifying dispute resolution scheme and will no longer be allowed to insist on a termination notice when clients choose to switch.

Although everyone is entitled to earn a living, the amount of commission that can be charged should not be excessive or undisclosed (a secret or hidden commission).

Businesses who have been mis-sold their energy contracts are entitled to claim back the money they have overspent, and this is where we can help…

There isn’t technically a time limit on claims as each may be different and will depend on the length of the contract or contracts and when they were signed, but also when you could have reasonably been expected to know that you may have had a contract which did not disclose these commissions.

If you answered NO and would like to find out more information, please click here.

Energy Claims 4 Business offers a no win no fee service and will carry out an initial assessment of your Energy Contracts. Where will submit a claim and handle all the communications of your behalf – all you need to do is send us the Contract(s) or Agreement(s) or even just an Energy Invoice