Small Business Energy

Are You a Microbusiness?

Let’s find out, because some of the strongest supplier rules only apply to you if you are. You’re a microbusiness if you employ fewer than ten employees (or FTE equivalent) and have an annual turnover or balance sheet of not more than £2 million, or if you use not more than 293,000 kWh of gas a year, or not more than 100,000 kWh of electricity a year.

The usage test catches a lot of people out. Picture a busy café with 14 staff. On headcount it isn’t a microbusiness, but if it uses 80,000 kWh of electricity a year, it can still qualify on consumption.

The next size up is a small business: one that employs fewer than fifty employees (or FTE equivalent) and has an annual turnover of not more than £6.5 million, or a balance sheet not greater than £5 million, or uses not more than 500,000 kWh of gas a year, or not more than 200,000 kWh of electricity a year. Some suppliers use either business size or energy use to decide which protections apply. Not sure where you stand? Send us a bill and we’ll tell you what your usage shows.

What Protections Do You Get as a Microbusiness?

If you’re a microbusiness, your supplier has extra duties to you. It must give you clear information about your contract and information about renewal prices before your contract ends. On evergreen (rolling) contracts only, it must limit termination notice to 30 days and acknowledge a request to end the contract within 5 working days.

There’s more. As a microbusiness, you can’t be rolled over onto a new contract for more than 12 months, and your supplier must give you details of any service fees included in your bill if you ask. The energy regulator, Ofgem, sets these microbusiness protections, and we’ll check your contract measures up to them.

Back bills are covered too. The back billing rules apply to households and microbusinesses: you don’t have to pay for energy used more than 12 months ago if you haven’t had an accurate bill for it, haven’t been told what you owed through a statement of account, or your Direct Debit was previously set too low to cover it. That protection doesn’t apply if you’ve acted unreasonably, for example by blocking access to your meter or ignoring requests for payment. If an old bill turns up, we’ll check it against your agreed rates and recorded consumption and take it up with the supplier.

Will You Know What Your Broker Earns?

You should, and with us you always will. Brokers are paid for their work: some charge an upfront fee, but most are paid commission by the supplier you choose.

The rules for microbusinesses got tighter in 2022. From 1 October 2022, suppliers have had to show brokerage costs in the contract’s principal terms as a total cost in pounds and pence. Suppliers were also banned from requiring microbusinesses to give notice of their intention to switch (evergreen contracts are exempt), and from 1 December 2022 suppliers may only work with brokers signed up to a qualifying alternative dispute resolution scheme.

That’s how a good broker should work anyway. You don’t pay us a separate fee: as your business energy broker, we’re paid commission by the supplier, which is included in the rates and charges in your supply contract, and we disclose it in full, in writing, before a contract is signed. Our alternative dispute resolution scheme is with the Energy Ombudsman. We’re also members of the Energy Consultants Association (ECA), which is a trade association.

How Do You Compare Small Business Energy Properly?

A headline unit rate on its own won’t tell you what a contract will really cost. Each quote has a unit rate (the price per kWh) and a standing charge (a fixed daily or monthly amount), and the right deal depends on how much you use and when. A low-use shop and a kitchen running ovens all day can be best served by very different contracts.

Then there’s the type of contract. On a fixed-rate contract, your unit rates and standing charges stay the same for the contract length. On a variable-rate contract, prices can rise or fall, often in line with wholesale prices. Most small businesses we speak to want the certainty of a fixed price, and we’ll help you find one that suits you.

This is where we take the work off you. We gather your meter details, usage and contract end dates before we ask suppliers for prices, because suppliers almost always need them and you get more accurate prices as a result. Then we give you a written selection of the most suitable options for you, so you’re weighing up like with like. You approve and sign the contract. We handle the rest, whether that’s business electricity, business gas or both.

Timing makes a real difference. We always advise arranging your next contract as early as possible, normally 12 months before your renewal date, so you can take advantage of forward pricing rather than the short-notice prices on offer in the last month or two. Switching works when your contract has ended or is about to, so if your energy contract is ending, get in touch and we’ll get prices together. If you’re mid-contract, tell us your end date and we’ll plan the switch for the right time.

What We Need From You

All we need to get started is a recent bill for each site. It doesn’t always give us the whole picture, so ideally we’ll also ask you to sign a Letter of Authority. Our Letter of Authority (LOA) lets us help you, not make decisions for you. Help with your contracts, bills and supplier queries: yes. Enter into a contract on your behalf: no. Some brokers ask for a ‘level 2’ LOA that lets them sign contracts for you. Ours is a level 1 LOA, so only you can agree a contract.

Your bill shows your meter numbers. The MPAN (Meter Point Administration Number) identifies your electricity supply and the MPRN (Meter Point Reference Number) does the same for gas. If you can’t spot them, send us the bill anyway and we’ll find your MPAN and MPRN for you.