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A quick guide to deemed contracts for Business Electricity Prices customers.

What is a deemed contract? A deemed contract is when a business energy customer uses electricity, or sometimes gas, from an energy provider without having agreed on a deal for use. Deemed contracts affect businesses most often when a business takes over a new premise before having agreed to a new contract with the current or a new, energy supplier. However, a deemed contract can also be imposed in other circumstances, such as when a contract has lapsed.

Are deemed contracts more expensive than other business energy deals?

Yes! Very much so. Deemed contracts are some of the most uncompetitive rates that energy providers offer – so they should be avoided. They can be as much as 90% higher than the best value energy deals on the market.

How can I tell if my company is on a deemed contract?

Unfortunately, as many as 10% of microbusinesses are thought to be on deemed contracts and given that means extra costs for businesses, that’s not good news.

If you believe you are on a deemed contract, contact your energy supplier immediately who will be able to confirm it.

Why is my business on a deemed contract?

There are two main reasons you would be on a deemed contract.

  1. Your company have recently moved to a new business address and have not contacted the current supplier to arrange a contract. The energy you use before this point will be on a deemed contract.
  2. Your business’ existing contract has come to an end, and your energy supplier has automatically switched you to a deemed contract.

What should I do if my business is on a deemed contract?

Look to switch to a new contract as soon as possible. Business Electricity Prices can help you find a great value business energy tariff and support your business switch.

Are deemed contracts enforceable?

Sad to say, deemed contracts are legal and enforceable by energy suppliers in many cases. However, if you can demonstrate that your energy provider has not taken steps to inform you that you are on a deemed contract, you may be able to negotiate with them. If your energy company has not done one of the following, you can usually seek to have your contract terminated:

  • Provided you with a copy of the full contract, if you ask for it;
  • Contacted you about other contract options before the end of your current contract and how you can get information on these.

Your energy provider cannot do either of the following:

  • Stop you from switching to another supplier, for any reason or at any time.
  • Force you to give notice before terminating the contract or charge you a termination fee.

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