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Bad move…? Avoid business energy deemed rates pain

28/01/2019

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Deemed rates … you may not have heard of them. Here is the scenario – you own a business and your current energy contract has expired or you have moved into new premises and not contacted your energy supplier. You know it made sense to switch energy supplier weeks ago. But you had lots to do. You got distracted and energy bills weren’t high on the agenda at that stage.

You became pre-occupied and forgot about it. But after a few days (maybe a week or so) an energy bill drops through the letter box.

The business energy prices for the premises have doubled. The sweat starts to form on your brow. Realistically this could hurt your business – costs need to be managed. Now you’ll struggle to pay the bills and you have little time to sort out this headache.

This nightmare has a name: business energy deemed rates.

Deemed rates come into place when a business has not renewed its business energy tariff before the contract end date. Or when a business moves into new premises and starts to consume gas or electricity without agreeing a contract with the supplier. You are ‘deemed’ to be being supplied by the incumbent supplier.

Deemed rates are a lot higher than contracted rates – by up to 80%.

To understand how your energy supplier describes deemed rates and what they will charge in these circumstances the majority have an explanation on their websites. Here’s a few to give you some insight:

British Gas

npower

SSE

Corona

Gazprom

 

What can you do?

The best way to avoid paying deemed rates is to contact the supplier in good time prior to expiry. That means being organised but it’s often easier said than done. Certainly, in the case of moving business premises it means putting business energy pricing near the top of your move to-do list.

How many businesses do deemed rates affect?

Around 10% of small businesses are on deemed contracts. That’s a lot! Make sure you are not one of them.

Our troocost benchmarking platform helps you see what a fair price looks like, without any hidden costs, and you can easily compare costs.

If you are moving premises, we can support you. It can typically take up to 31 days to change supplier, so we advise you speak to us a month or more in advance of your energy renewal date.

Or if you already use our service we will prompt you well in advance of that renewal date and we will guide you through the process. Don’t fall into the deemed rate trap and throw your hard-earned money away.

www.troocost.com

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