How do I know if I have been mis-sold a business energy contract?

If you have used an energy broker to procure your business gas and electricity, there is a high chance that you may have been mis-sold to and are entitled to make an energy claim. Businesses throughout the UK have been mis-sold their energy contracts through the use of energy brokers, and it is only recently that government agencies, Ofgem and BEIS (Business, Energy, and Industrial Strategy), have begun to take notice of this malpractice. Business Energy Claims are the market leaders in helping businesses to recover hidden commissions and losses from the mis-selling of energy contracts, offering businesses the redress they deserve.

Types of Business Energy Contract Mis-selling

Being mis-sold to can take many different forms, which makes it particularly difficult to spot. Each of these practises goes against the energy brokers fiduciary duty; to act in the best interest of the client. To date, Business Energy Claims have lodged energy claims on behalf of their clients relating to the below forms of mis-selling:

• Hidden commission fees: Energy brokers add an uplift to the to the fee you pay the energy supplier. The supplier then pays this uplift to the energy broker as commission without your knowledge, making the cost of your energy more expensive.
• Favouring suppliers: Energy brokers should search the entirety of the market for the best rates available, however this is often not the case as certain suppliers are awarded the contract when they offer greater incentives to the energy broker.
• Misrepresentation: An energy broker may claim they have searched the markets for the ‘best price’, however they may only have checked one or two suppliers.
• Negligence: In some instances, energy brokers will fail to provide businesses with the correct advice, suggesting long term or pass-through contracts that may not be in the best interest of the business
• Serious misconduct: Unfortunately, this practise still occurs. Business Energy Claims have found instances where fictional price comparisons have been presented to the client, and in rare circumstances, energy brokers have even agreed contracts without the consumer’s consent.

Examples of Business Energy Contract Mis-selling

Tens of Thousands of businesses throughout the UK have already started their energy claim, with the below highlighting just a handful of the cases, with the average claim amount totalling £25,000.

• A hotel used an Energy Broker in March 2019 to agree two gas contracts. The hotel did not receive any form of disclosure from the Energy Broker and only discovered their contracts contained such high levels of commission after speaking to Business Energy Claims. The hotel struggled throughout the COVID-19 pandemic therefore having this level of commission included within their contracts has placed an unnecessary strain on the business that, legally, should never have occurred. After negotiations, the Energy Broker agreed the contracts contained hidden commissions and agreed to repay the hotel a total of £60,000.
• A manufacturer used the services of an Energy Broker to agree two electricity contracts in 2018. The manufacturer was not informed of the commission within their contracts by their Energy Broker and only discovered the issue once they got in touch with business Energy Claims. Following a short negotiation process, the Energy Broker admitted that the contracts did include hidden commission and agreed a settlement of approximately £25,500.
• A care home had dealt directly with the supplier prior to receiving a call from an Energy Broker, and had no knowledge of how they operate. After being promised the best deal, the care home entered into 12 gas and electricity contracts with the assistance of the TPI. Each contract included hidden commission that was only disclosed to the care home upon request of the same after each of the contracts had been agreed. The care home was awarded £7,000 in compensation.

Why Business Energy Claims?

Since 2018 Business Energy Claims has worked to help businesses that have been mis-sold energy by their energy broker and has been collating information of unethical practices. It used this experience to submit a comprehensive report to BEIS in a bid to increase transparency within the industry.

With Energy prices spiralling out of control, making an energy claim has become an important weapon in the business arsenal in the never ending war on overheads. Business Energy Claims can provide a no obligation review of your energy contracts, and if agreed, progress your energy claim on a No Win, No Fee basis.