Doing nothing cost this business £3,200

Procrastination just plays into the hands of your energy company. This is a true story about a dry cleaning business who ignored the renewal letter from their electricity supplier. Failure to arrange a new energy contract cost them thousands of pounds.

The business owner contacted us when he realised he may have left it too late to do anything. Businesses do cut it a bit fine sometimes when they contact us – they can often be a few days away from the notice date, or indeed the end date of the energy contract if they have terminated directly with the supplier. Or, as in this case, too late altogether…

Don’t wait until the month your energy contract ends

The owner thought his business electricity contract with British Gas ended in August, and therefore he assumed that August was the time in should be looking at prices and deciding whether to renew with British Gas or look elsewhere for a better price. This doesn’t factor in the following: 1. British Gas require 90 days notice before the current energy contract ends, otherwise a business customer will be committed to another 12 months (longer if a non-micro business) at higher prices. 2. Even if he had terminated the contract before the last 90 days of the contract, leaving it so close to the contract end, he didn’t leave time to switch supplier, which can take around four weeks. During this stage he will be charged deemed rates.

Don’t ignore the renewal letter from the energy supplier

The owner came across it in a pile of paperwork he hadn’t had a chance to look at for a while, as he was so busy running the business. It didn’t make good reading. While he was correct that the contract ended in August, the notice date – the date he should have told British Gas he didn’t want to accept the new prices – was in May. It was now August, and because he hadn’t given notice, British Gas have put his business on another contract. The letter also gave him the new prices, which were now over 13p per kWh of electricity, roughly 4p per kWh more than he was paying British Gas previously. For a small business, this is a disaster. Dry Cleaning businesses consume a lot of energy, about 80,000kWh a year in this case. That is an extra £3,200 that he didn’t need to pay if he had kept an eye on the dates in his contract. When you agree a new contract, put a reminder in your diary to review it four months before it ends.


Perfect Clarity can help businesses save money on their energy and water contracts. Call 020 3372 6517 for more information.