Small and medium business owners are being urged to compare business gas and electricity prices and shop around for the best deals - rather than letting their existing energy contracts 'roll over'.
Many businesses could be missing out on cheaper gas and electricity because they are not proactive about their supplier contracts.
Most business energy contracts automatically 'roll over' when they are due for renewal. Energy suppliers then lock businesses in to new contracts, which are often more expensive than their previous deal.
Businesses are free to shop around for better gas and electricity prices - but must ensure they are aware of the required notice period and termination dates of their existing contracts.
Simply switching supplier could save your business hundreds of pounds on energy costs: so it's well worth doing a bit of background research to ensure you have the best deal. Energy comparison websites are a good place to start.
Here are some key things to keep in mind:
* Many business do not know when their business energy contract expires: be sure to check your paperwork.
* If you do not act at right time to switch supplier, your existing contract will 'roll over' at less favourable rates.
* Businesses who sign with a new supplier after an existing contract has rolled over are in breach of contract, and the new supplier could take legal action.
Energy watchdog Ofgem was aware of the problem of businesses - especially SMEs - being locked into new rolled-over contracts which were more expensive than previous deals, and, in early 2010, introduced new regulations to protect businesses.
The regulations set out new requirements: suppliers must provide detailed contract information to customers, without hiding key clauses in the small print; customers must be provided with clear terms and conditions and a statement of renewal terms of the contract separately; suppliers must remind customers of a contract renewal date no longer than 120 days before it is due, and customers can renegotiate a new deal within a 30-day 'renewal window' after receiving this notice; customers who do not act can be rolled over for a maximum of 12 months.
Suppliers often have different termination notice periods - be sure to check yours. Some may be up to 120 days in advance. However, businesses are free to sign a new energy contract up to three months before their current agreement ends, as long as they follow the correct termination procedure for their existing deal, to help make the transition between suppliers smooth and seamless.
* Make sure you know your renewal date
* Use an energy comparison site to shop for a new deal
* Give your supplier the correct termination notice
* Read all paperwork, terms and conditions thoroughly before signing a new contract
* Make sure you understand your pricing structure, terms and conditions, and keep your paperwork safe
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