Millions of businesses in the UK rely on energy brokers to obtain their energy supply, as brokers act as intermediaries between the businesses and the energy supplier.
It’s highly likely that if you have used an energy broker, they may have included undisclosed commission in your energy contracts without providing clear information about it.
If you have found that your broker did not declare the commission they would receive as a result of arranging your business energy contract, you may have grounds for a mis-selling claim. This is because energy brokers have a legal obligation to be transparent about any commission they will receive, as this could impact the price you end up paying for your energy.
How do brokers hide commissions within energy contracts?
Energy brokers typically earn their commission by adding a markup to the price of the energy contract they are selling to their clients. This markup is not always explicitly disclosed to the client and can be hidden within the contract.
One way brokers can hide their commission is by presenting the contract price as a bundled rate, which includes both the cost of energy and the broker’s markup. This can make it difficult for clients to determine the exact amount of the broker’s commission, as it is not broken down separately from the energy cost.
Another method brokers may use to hide their commission is by offering contracts with complex pricing structures. These contracts may include various fees, charges, and incentives, which can make it challenging for clients to understand the true cost of the contract and identify the broker’s commission.
Here’s an example of how mis-selling works:
30p/kWh – Actual cost of your energy
2p/kWh – Commission given to the broker
32p/kWh – Amount you are paying
2p/kWh – Commission paid to the broker by the supplier
In some cases, brokers may claim to offer a free service or to be paid a set fee by the energy supplier, when in fact they are receiving commission. This can lead to confusion and may mean that you end up paying more than you should for your energy.
How do I know if I have been mis-sold a business energy contract?
If you suspect that you have been mis-sold a business energy contract, there are several signs to look out for. Here are some common red flags that could indicate a mis-sold energy contract:
- Unexpected changes in your bills: If you notice sudden and unexplained increases in your energy bills, it could be a sign that you were sold a contract with hidden fees or rates.
- High-pressure sales tactics: If the energy broker or supplier used aggressive or misleading sales tactics to pressure you into signing a contract, it could be a sign of mis-selling. For example, they may have made false claims about their rates or services, or pushed you to sign the contract without giving you adequate time to review it.
- Lack of transparency: If the contract terms and conditions were not clearly explained to you, or if you were not given a copy of the contract, it could be a sign that the energy broker or supplier was not acting in your best interests.
- Offering a full or partial refund: Some energy brokers are offering refunds to clients on the basis that they sign a document stating they will not pursue them for a number of reasons. This tactic is being deployed to stop claims being brought against them.
- Poor customer service: If you have had difficulty contacting your energy supplier or broker, or if they have not responded to your queries or complaints, it could be a sign that they are not providing the level of service promised in the contract.
- Early termination fees: If you are being charged high fees to terminate the contract early, it could be a sign that the contract was mis-sold to you, as you may not have been fully aware of the terms and conditions at the time of signing.
How much is my business energy claim worth?
The value of your business energy claim will depend on a number of factors, such as the specific details of your case, the extent of the mis-selling, and the amount of financial harm you have suffered as a result of the mis-selling.
In general, if you have been mis-sold an energy contract, you may be able to recover any financial losses you have incurred, as well as any other damages you have suffered as a result of the mis-selling, such as stress, inconvenience, or damage to your business reputation.
To receive an estimated claim value, use our free and easy claim calculator.
How can I start my claim?
To make a business energy claim, you should contact us immediately to see if any commission has been declared within your contract.
You will need to provide details such as the unique MPAN or MPRN, the name of the energy supplier, the contract start and end dates, and information about the type of meter you have and the current unit rates and standing charges.
Claims can be made for both previous and current business energy contracts, so if you have been affected by mis-selling in the past, it’s worth exploring your options. A successful claim could result in compensation or a reduction in your energy bills, so it’s important to take action if you believe you have been mis-sold a business energy contract.