After so much turbulence in the market in recent times, renewing your business energy contract can feel more complicated than it should. How do you know you’re getting the best rates? What if you lock in high prices for too long? And how do you actually go about renewing your business energy contract? That’s why we’ve created our quick Business Energy Renewals Guide, to help you navigate the energy market and get the best solution for your business.
We’ve covered everything you need to know, from understanding your contract to the rules of renewing. Check out our guide below, and get renewal savvy.
What are the Regulations on Business Energy Renewals?
Let’s start by understanding the rules and regulations regarding business energy renewals. When your contract is due for renewal, you should receive a renewal reminder from your supplier around 70 days before your contract end date. This reminder will include your account information and outline your renewal options.
Failing to renew within the specified period could result in your business being transferred to deemed or out-of-contract rates, which are generally higher than the prices offered on fixed-rate contracts. These variable rates fluctuate with the market, so if the wholesale cost drops, you could see lower rates, but if the market rises, so will your rates.
If you decide to switch your business energy supplier during this period, you will likely need to give notice of termination to your current supplier. If you’re unsure of your notice period for ending your contract, you should be able to find it in your terms and conditions.
However, if you operate a microbusiness, you no longer need to give notice in advance of termination. A microbusiness is defined as a non-domestic consumer who:
- Employs fewer than 10 employees (or full time equivalent) and has an annual turnover or balance sheet no greater than €2 million; or
- Uses no more than 100,000 kWh of electricity per year; or
- Uses no more than 293,000 kWh of gas per year.
with specific criteria, such as having less than 10 employees with a turnover less than £1.8 million, however, if you have more than 10 employees but you use less than 100,000 kWh of electricity or less than 293,000 kWh of gas per year you’ll be classified as a microbusiness and different rules apply to your contract. These rules offer greater transparency and flexibility, allowing you to switch without giving termination notice.
When Can You Renew Your Business Energy Contract?
There’s no specific time to start thinking about renewing your business energy contract, however, its generally recommended to start researching renewal prices around three months prior to your contract ending. Your supplier should contact your around 70 days before your contract ends, but you can request a renewal price sooner.
Remember that if you do want to switch suppliers, you may have to give a certain amount of notice, so it’s worth doing your research in plenty of time. If you are looking at renewal prices early, its also important to check your terms and conditions for any early termination fees.
What is the Process for Renewing a Business Energy Contract?
The process of renewing your business energy contract looks slightly different for everyone. For a general guide, follow the steps below:
- Review Your Current Contract: Begin by reviewing your existing energy contract to understand its terms, expiration date, and any renewal requirements or notice periods. This will help you plan ahead and ensure a smooth transition.
- Research Energy Suppliers: Research and compare different business energy suppliers to find the best options for your business. Consider factors such as pricing, contract terms, support, and any additional services or benefits they offer.
- Get Quotes: Contact multiple energy suppliers and request quotes for your business energy contract renewal. Provide them with relevant information about your energy usage, business size, and any specific requirements or preferences you have. Compare the quotes received, including the contract terms, pricing structures, and any associated fees or charges.
- Discuss Terms: Once you’ve found your preferred plan, you can discuss the contract terms to ensure they align with your business needs. This may include discussing pricing, contract duration, payment terms, renewable energy options, or any other relevant factors.
- Finalise the Contract: Now you’ve agreed upon the terms, you should be sent your new contract. Review the contract carefully before signing it. Ensure that all the agreed-upon details are accurately reflected in the contract, including pricing, duration, termination clauses, and any other important provisions.
If Switching Suppliers
- Provide Notice to Your Current Supplier: If your existing contract requires a notice period for termination or renewal, make sure to provide the necessary notification to your current energy supplier within the specified timeframe. Failure to give notice may result in automatic contract renewal or penalties. Make sure any outstanding bills are settled to ensure a smooth transition.
- Transition to the New Contract: Coordinate with the new energy supplier to schedule the transition from your current contract to the new one. Provide any required meter readings or other information as requested by the supplier. They will handle the logistics and ensure a smooth changeover of your energy supply.
Why Renew Your Business Energy Contract?
Although renewing your business energy contract isn’t the right thing for everyone, there are multiple reasons why you should consider it. These include:
Price Stability: Securing your rates with a fixed-term contract protects your business against any fluctuations in the energy market. By renewing your contract at the right time, you protect your business from high costs and uncertainty. This can be especially beneficial for businesses operating on tight budgets or those that rely heavily on energy-intensive operations.
Cost Savings: By renewing your energy contract, you can avoid being placed on costly deemed or out-of-contract rates, which are usually significantly higher than fixed-contract rates.
Avoid Disruption: Renewing your business energy contract ensures a seamless transition from one contract term to another without any disruption in energy supply. It eliminates the need to go through the process of moving to a new supplier, negotiating new terms, and potentially experiencing a gap in energy service.
Long-Term Planning: Renewing your contract allows your business to plan for your energy needs over an extended period. It provides stability and predictability in budgeting and forecasting.
Simplicity: If your current supplier is offering a competitive renewal price, and you’re happy with their service, renewing your contract can be simpler than switching to a new supplier. Your current supplier will know your business, have all your account details, and can transfer you to a new contract quickly and easily.
What happens if you don’t renew your business energy contract?
If you don’t renew your contract, and you don’t take out a plan with another supplier, you could automatically be placed on out-of-contract variable rates, which tend to be higher than fixed-rates. Since variable rates fluctuate with the market, it can make planning and budgeting for your energy needs difficult.
Renewing with Yü
At Yü, we want to make business energy renewals simple. We’ll remind you that your renewal is due in plenty of time, making the whole process as stress-free as possible. Our competitive prices and range of plans make the choice to renew an easy one, and with our simple three-step process, you can get a quick quote in no time. Just fill out our renewals form, provide your details, and one of our representatives will call you with your renewal quote and plan options. It’s that simple!
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