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Business Energy Contract Termination Guide
Is your current business energy contract coming to an end? Are you unhappy with the tariff you’re presently on?
We have put together this guide to provide you with all the help and advice you need to successfully cancel your business energy contract. We can also help you switch suppliers who can better suit your needs.
Why terminate your business energy contract?
Terminating your business energy contract is important as it helps to prevent you from being charged expensive rollover rates from your supplier. It’s estimated that rates can increase by 30%-100% on a default rollover contract! Your supplier can also bind you into this new, more expensive contract if you fail to terminate in time.
Expensive rates lead to even more expensive gas and electricity bills, which can cause your business overheads to be unnecessarily high.
To keep your business expenses as low as possible and maximise profits, we recommend terminating your energy contract when it is up for renewal and comparing energy prices to find a cheaper deal.
How does terminating a business energy contract differ from cancelling a domestic energy contract?
The process of cancelling a business energy contract is typically more complicated than terminating a domestic energy contract. Businesses are usually tied into their energy contracts for a longer length of time (usually at least 12 months). It can often be longer. Businesses cannot cancel their deal before the end of their contracted period.
However, businesses can agree terms on their next energy contract to lock-in cheaper deals. This is known as the renewal window. There is also no cooling-off period for business energy tariffs.
If your supplier does allow you to cancel your contract before it’s renewal date, you are likely to have to pay a large cancellation fee.
Terminating your business energy contract
If you’d like to terminate your business’ energy contract, there are a few steps that you’ll need to take. These include:
- Keep an eye out for your renewal letter
If your company is considered a microbusiness, your energy supplier is required to send you a renewal letter at least three months prior to your renewal date. This document will include details about your current tariff, its renewal date and your options in terms of cancellation or continuing with your existing supplier.
If your business is not considered a microbusiness, the onus is on you to remember your contract’s renewal date and organise a termination or supplier switch.
- Send a termination letter to your supplier
Sending a termination letter to your supplier is the most effective way to cancel your energy contract. You can do this via email or post. Just ensure that you set delivery receipt alerts if you choose to send an email, and get recorded delivery if you send the letter by post.
Additionally, most suppliers require you to send your termination notice at least 30 days prior to your contract’s end date. Any later than this could lead to you being placed on an expensive rollover contract.
If you’d like to save yourself the hassle of sending a termination letter, you could switch energy suppliers with Business Electricity Prices. If you provide enough notice, we’ll terminate your current energy contract and manage your switch to a new supplier.
To find out how much you could save, compare energy quotes with Business Electricity Prices.
If you opt to terminate your contract yourself, here are some of the details you should include in your termination letter:
- Your meter number
- Your energy account number
- A signature from an individual known to the supplier in association with your business
- The document should have your business’ letterhead, or the email should come from a business email address
Below is an example of a termination letter template:
To Whom It May Concern,
To: Your energy supplier’s address
From: Your name, company name and registered business address
Please accept this letter as formal notice of the termination of energy contract [contract number]. This notice is for meter numbers MPAN/ MPRN, registered at the address quoted at the top of this document. This termination notice is set out in accordance with the terms and conditions of the contract and is to take effect as of the contract end date.
Please confirm in writing you have received this notice of termination.
Your Company Name.
- Find a cheaper tariff
Once you’ve sent your termination letter to your old supplier, you can begin to compare energy deals on the market to find a cheaper tariff for your business gas and electricity.
Be aware that comparing energy tariffs can be a difficult and timely process if you choose to do it on your own. However, here at Business Electricity Prices, we aim to make it as simple as possible for you to find the best energy deal for your company. We also seek to make the switching process easy and seamless.
Try our free online comparison tool today to find the best business energy deals on the market.