Small businesses are paying too much for energy

  • Suppliers not offering companies the best deal

MANY small businesses are paying too much for their energy, according to a Peterborough-based energy broker.

Suppliers are allowing business users to pay more than is necessary by keeping them on inappropriate meter codes and tariffs. That’s the claim being made by Ken Perrin, a commercial energy consultant.

Mr Perrin said, “Since deregulation in the late 1990s, energy companies have become driven by profits, not service, leaving the SME sector vulnerable to high costs, inflexible contracts and generally poor service.

“Typically, businesses look only at unit rate (price per KWH), but are unaware that having the correct meter code and tariff is also important in cutting costs. No energy company offers a review of this. Many businesses have the incorrect meter code and tariff – costing them more for their energy.”

Mr Perrin cites an example is of a Wisbech company paying approx £3200 per annum for their office electricity. They were on the wrong meter code, paying £2.34 per day instead of 35p per day standing charge. Having the meter code changed saved them over £ 700 per annum.

Businesses also run into trouble and incur heavy costs when they forget or are not aware of the contract end date. The energy supplier is supposed to contact the customer 120 days prior to the contract end date, but according to Mr Perrin, 60 per cent of letters never arrive. This leaves the business in a vulnerable position if it also fails to remember the end date. The supplier, on the first day after the contract ends deems the business to be ‘out of contract’ and can increase the unit rate by up to 40-50 per cent – and the business will not know about this increase until the next quarterly bill arrives.

“A building services company, busy winning and fulfilling contracts, was horrified to receive an enormous bill,” said Mr Perrin. “They were being charged nearly 15p per KWH as they were out of contract. I emailed a letter of authority to their existing supplier and switched them to another supplier that charged reasonable rates. This saved them £800 on a £2,600 per annum bill and they are now also on smart metering.”

Ken Perrin is offering all businesses in the Peterborough area a free meter code and tariff analysis, plus a reminder of when contract expiry dates are due. For more information, call 0759 052 2579 or email:

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