Earlier this year, Ofgem introduced the Faster Switching Programme. This regulation project replaces the two current switching services, UK Link for gas and Meter Point Registration Service (MPRS) for electricity, with a new Central Switching Service (CSS).
In addition to providing dependable, quick, and affordable service, CSS is designed to streamline the process across gas and electricity companies. How does this impact your business, and is it beneficial? Click here to find out how Ofgem’s Faster switching programme can benefit your business, and read on to find out exactly how it all works.
What Is Faster Switching?
Ofgem developed the Faster Switching initiative to streamline switching energy suppliers. Historically, the entire process took approximately 15 days to be finalised. The regulation aims to allow domestic and non-domestic consumers to switch energy providers within a five-day window.
Suppliers and partners were ultimately forced to change their processes, systems, and technologies significantly. However, through Faster Switching, businesses are given the confidence to switch their energy suppliers easily, making the process much simpler for them. Ofgem has announced they plan to reduce the switching timeline further to deliver energy switching within two working days in the future.
How Does Faster Switching Benefit My Business?
The regulation is especially beneficial for businesses, and finding a new deal with new suppliers will be more accessible when your business contract term ends. However, switching providers is not recommended in light of the UK’s energy crisis, and it could be costly to switch energy providers since many are no longer accepting new customers.
However, if your energy provider closes for good, the gas and electricity you receive will not be affected. You don’t have to do anything since Ofgem will select a new supplier for you and notify you.
Within five working days of your contract start date, your energy supplier must start supplying gas or electricity to your business. The reality is there may be issues that could delay your supply.
Several reasons for the delay could include the following:
- If you apply for the faster switching programme after business hours, the switch should occur the following business day.
- Should you have outstanding debt from your existing supplier. Until this debt is paid off, only then will you be able to switch.
- Failing to pay the new energy supplier’s security deposit.
- There could be a delay if you are connected to a private electricity or gas network and your supplier is connected to a different distribution network.
- You have no metering arrangement in place for your new energy supplier to provide you with gas or electricity.
Faster Switching and the Cooling-off Period
When entering into business energy contracts with consumers, energy suppliers do not allow cooling-off periods. This is because providers make energy purchase projections and decisions based on the specific needs of their business clients.
While Ofgem’s mandatory cooling-off period only applies to domestic clients, it is crucial that businesses look into finding a business energy contract that is the right fit for their type of business. Depending on your current supplier, should you be allowed to cancel your contract before the renewal period, you will be charged an early exit fee.
How To Find the Right Business Energy Contract
When business energy contracts aren’t protected by a cooling-off period, and the possibility of being on an out-of-contract rate does exist, finding the right deal becomes imperative. You won’t be able to reverse the situation once the contracts have been signed if you get it wrong. When choosing a new business energy contract, make sure you consider the following factors:
- Deciding which type of contract is best suited for your business, your choices will most likely be a fixed-term or variable rate. With the current energy crisis, a fixed-term rate is more beneficial, protecting your business from rising energy prices.
- A business energy contract is very different from a domestic contract in that it purchases sufficient electricity or gas in bulk to cover the entire run of the contract. To determine the best contract length for your business, consider the amount of energy you consume.
- Also, consider how long you have to give your business energy supplier if you decide to terminate your contract during the renewal period.
Business consumers can benefit from the faster switching programme, but finding a new supplier who offers a suitable business energy contract remains critical. During the current energy crisis, you are best served by using a comparison site or energy broker to find the best deal.