What to Check Before Signing a New Energy Contract
Before you commit to a new business energy contract, take a moment to slow down. The terms you sign today will define your costs, risks, and flexibility for the next one to three years. Many businesses sign too quickly – trusting an offer or a broker without confirming the details. This guide walks you through the critical checks to make before signing, so you can be confident that your contract is fair, transparent, and aligned with your business goals.
Confirm Who You Are Actually Contracting With
Start by verifying the legal parties involved. You may be speaking to a broker, but your actual contract will be with the supplier. Check the documents carefully – the supplier’s name and registered address should appear clearly on the agreement.
- Supplier Name: Must match the registered company on the offer and on Ofgem’s approved supplier list.
- Broker or Intermediary: If a third party is involved, confirm they are authorised to act on your behalf and disclose their role clearly in writing.
- Contract Type: Understand whether the offer is fixed, flexible, or variable – and which party sets rates.
Energy brokers often manage communication and paperwork, but they do not supply energy themselves. Knowing exactly who holds the contract ensures accountability later if billing or renewal disputes arise.
2. Review Contract Length and Termination Terms
Many business owners focus on price per kilowatt-hour and overlook contract duration. But the length of your contract determines how long you’re committed – and how flexible you remain if market prices fall or your business changes.
- Contract start date: When does the term officially begin – on signature, supply start, or meter registration?
- Contract end date: Know the exact expiry date in advance.
- Notice period: Typically 30–90 days. Missing it may trigger auto-renewal or penalty charges.
- Termination clause: Understand how to exit early and what fees may apply.
Make sure all key dates are entered in your records immediately after signing. It’s the simplest way to prevent unwanted rollovers or renewal disputes later.
Understand the Pricing Structure
Price is not just the unit rate. Business energy bills include several components – and understanding each helps you spot inflated or misleading offers. Ask for a full price breakdown before agreeing to anything.
- Unit rate: The cost per kWh of electricity or gas. Check whether it’s fixed for the full term.
- Standing charge: Daily fee to cover network and meter costs. Compare against current rates.
- Third-party charges: Confirm whether network and government charges are included or passed through separately.
- Broker fees: Ask whether the broker’s commission is built into the rate or billed separately.
- VAT and CCL: Confirm whether prices shown are inclusive or exclusive of VAT and Climate Change Levy.
Request all figures in writing. Verbal rate quotes are not enforceable, and some brokers quote only the unit rate, leaving hidden costs unmentioned.
Ask for Full Broker Transparency
If a broker or consultant introduced your offer, you have a legal right to know how they are paid. Hidden commissions are one of the most common causes of overpayment in business energy contracts.
- Ask for a written statement of all commissions, margins, or fees added to your rate.
- Confirm whether they are paid by the supplier or directly by your business.
- Check whether your contract includes any clauses allowing ongoing commissions for renewals.
Reputable intermediaries disclose their fees in writing before you sign. If you can’t get a clear answer, treat it as a red flag. At Energy Problems, we disclose our role and fee structure openly so you always know where your money goes.
Confirm Meter and Site Data Accuracy
Every business energy contract is linked to a specific meter and site. If your site data is wrong, such as the wrong MPAN or MPRN, the contract may apply to the wrong supply point, leading to billing confusion or even disconnection.
- Check that the MPAN (electricity) and MPRN (gas) match your actual meters.
- Ensure the site address on the contract matches your physical location and invoice.
- If you manage multiple sites, confirm which meters are included in the agreement.
Incorrect data causes billing errors and delays during switching. Always verify your meter information before signing and before any transfer request is sent.
Examine Clauses Around Price Changes and Adjustments
Some “fixed” contracts are not truly fixed – they include clauses allowing suppliers to adjust rates if government or network costs change. Understand what flexibility you’re agreeing to.
- Look for clauses mentioning “pass-through” or “variable non-commodity costs.”
- Check whether your supplier can change rates mid-term and under what conditions.
- If you prefer full certainty, ask for an “all-inclusive fixed-rate” contract with no pass-through adjustments.
Energy Problems can review your supplier’s terms and explain exactly which charges are fixed and which may change — before you commit.
Verify Renewal and Termination Clauses
Every contract includes renewal terms – and ignoring them is one of the fastest ways to lose control of your costs. Make sure you know how the renewal process works before you sign, not after.
- Does your contract auto-renew if you miss a notice date?
- When does the notice window open and close?
- Is written notice required, and where must it be sent?
- Are there penalties for switching suppliers during the final months?
Adding these dates to your calendar from day one prevents renewal traps later. If you’re unsure how to word a termination notice, Energy Problems can prepare one for you.
Check for Any Third-Party Authorisations
Some contracts allow third parties, such as brokers or consultants, to act on your behalf during the term. This can be helpful, but only if you trust the intermediary completely and their role is clearly defined.
- Read any “Letter of Authority” (LoA) carefully. It defines what your broker can and cannot do.
- Check whether the LoA expires after the contract is signed or continues indefinitely.
- Never sign an LoA that allows contract renewals or supplier changes without your written consent.
Energy Problems uses time-limited Letters of Authority strictly for data verification and supplier communication. You remain in control of all contract decisions.
Ensure the Offer Is Current and Binding
Energy prices fluctuate daily. An offer made last week may no longer be valid today. Always confirm that the rate you’re signing reflects current market conditions and is formally accepted by the supplier.
- Ask for a signed offer confirmation or supplier acceptance letter.
- Check the validity date – many offers expire after 24–72 hours.
- Ensure your business details match across all documents before returning a signature.
Delays or incorrect paperwork can cause your rates to default to higher “out of contract” prices. If you need help confirming offer validity, our team can liaise directly with your supplier to secure it in writing.
Final Pre-Signing Checklist
Before you sign, take five minutes to confirm these essentials:
- Supplier and business names are correct
- Contract term, start, and end dates are clear
- Notice and termination terms are known
- Rates and standing charges are confirmed in writing
- Broker fees are disclosed and understood
- MPAN/MPRN and site details are accurate
- No hidden clauses or long-term rollovers
- Offer validity and acceptance are documented
If any point is unclear, do not sign. Ask for clarification in writing – or ask an independent intermediary like Energy Problems to review the contract for you before you commit.
How Energy Problems Helps You Sign Safely
Energy Problems provides businesses with a complete pre-signing review service. We check supplier paperwork, verify site data, confirm contract terms, and disclose any potential risks or hidden fees before you commit. Our process ensures that every contract you sign is transparent, compliant, and genuinely beneficial to your business.
- Independent review of supplier contracts
- Verification of pricing and commission structures
- Site and meter data validation
- Renewal and notice date management
Our goal is simple: help you sign only the right contracts, for the right price, at the right time.