The £7 billion price tag of loyalty in the business energy market
Businesses that stay loyal to energy suppliers might be giving themselves a hefty price hike. The recent Competition and Markets Authority (CMA) investigation* into the energy market concluded that half of the SME customers of the Big 6 energy companies haven’t switched supplier in the past 5 years, while some have not done so since privatisation.
Recent research by the energyhelpline business team shows that the bill for businesses which don’t shop around could be overpaying by £532 a year. So across the 5.2 million small and medium sized businesses in the UK the bill could be reaching an extortionate £7 billion every year.
Businesses, like households need to be proactive when it comes to their energy bills or they might be in danger of getting ripped off.
The CMA also found that businesses that don’t shop around could end up falling for one of these traps:
– Rollover tariffs – if businesses don’t actively negotiate renewal contracts, suppliers often automatically transfer them onto rollover tariffs. These can be 20-40% more expensive than retention tariffs
– Deemed or out of contract tariffs – 45% of small businesses are still on such tariffs and they can be up to 116% more expensive. More than double the price of retention tariffs!
Nevena Mulyachka from the energyhelpline business team commented:
“Businesses are increasingly suffering due to their passive approach to energy contracts. In a competitive market place, companies cannot afford to spend more on utilities than is necessary.”
“By being proactive and switching, businesses can save on average £532 a year. Enough to make a real difference to their bottom line!”
“With the winter months just around the corner and energy price rises expected, now is the time to switch onto a more affordable alternative. With many suppliers offering competitive tariffs for businesses, there will be a tariff suitable for your usage and budget and comparison sites like energyhelpline business can help you find it.”
Our business energy experts can compare prices from 16 business energy suppliers and provide a free quote within minutes. If you chose to switch, they can then help with all the paperwork and communication between the old and new supplier, thus saving you both money and time!