Energy Strategy
May 8, 2026
The energy market doesn't work in the customer's favour. Auto-rollovers, opaque pricing, confusing contract terms, and a regulatory structure that hasn't caught up. The four reasons most UK businesses end up overpaying, and the things worth doing about it.
UK business energy is one of the few markets where the customer doesn't really benefit from being a customer. Suppliers price aggressively to win new contracts, then quietly extract margin from customers who don't pay close attention. The structures that produce this aren't accidental — they're the result of how the market evolved, what it's regulated for, and what most buyers actually do.
Four reasons most UK businesses end up overpaying, and the things worth doing about each.
Most UK business energy contracts have an auto-rollover clause. If you don't actively switch supplier in a specified window before the contract end date, typically 30-180 days, your contract automatically renews on the supplier's then-current rates.
Those rates are almost never the rates you'd get if you actively switched. They're the rates a customer pays who isn't paying attention. Suppliers price them accordingly.
Across an estate of multiple sites with different contract dates, the rolling rollover risk becomes a structural cost. One site rolls over while you're focused on another. The cumulative cost of missed switching windows across a multi-site business runs into six figures over a few years.
The fix is mostly administrative. Centralise contract end dates across all sites, set calendar reminders 6 months before each, and run a market review at every renewal whether or not you intend to switch. The discipline is worth more than the brokerage.
When a contract genuinely ends with no replacement, you don't stop receiving electricity or gas — the supplier moves you onto "out-of-contract" or "deemed" rates. These rates are typically 50-100% higher than negotiated contract rates, and there's no legal requirement to notify you that you've moved onto them.
Businesses that have changed premises, taken over leased sites, or come out of administration often find themselves on these rates without realising. The supplier has no incentive to flag it. You only notice when the bills become impossible to ignore, by which point you've been paying the inflated rates for months or years.
The fix is to check the rates on every bill you receive, not just the totals. If your pence-per-kWh rate doesn't match the rate on your contract, something is wrong and worth investigating.
Most energy contracts are quoted as a single per-kWh rate, with the breakdown of that rate hidden inside the unit cost. The actual components include:
Wholesale electricity or gas cost
Network charges (transmission and distribution)
Non-commodity charges (Climate Change Levy, BSUoS, capacity market, renewables obligations, FiT and CfD costs, etc.)
Supplier margin
Broker commission (if applicable, often built into the rate without separate disclosure)
Only the wholesale cost and supplier margin are genuinely negotiable. The rest is statutory or regulatory. But many brokers and suppliers quote rates that are essentially the wholesale rate plus a substantial markup, presented as if the whole thing is competitive.
A regulated broker working in the wholesale market should be able to show you the build-up of the rate quoted. If they can't or won't, the rate is probably not as competitive as it looks.
Most UK businesses are overpaying by some combination of all four factors. Auto-rollover, out-of-contract rates, opaque pricing, and broker incentive misalignment. The actual overpayment varies but typically sits in the 10-25% range against what the same business could pay with active management and a transparent broker relationship.
The way to find out where your business sits on that range is to have someone independent review your actual bills. Not a broker promising savings without seeing the numbers, but someone who'll look at what you're paying, compare it against the current wholesale market, and tell you honestly whether you have a problem to fix.
If your last 12 months of bills are reasonably accessible, send them through. Our regulated broker partner will run the comparison, and we'll come back within five working days with a real number. If you're not overpaying, we'll tell you. If you are, we'll tell you by how much and what to do about it.
