One in five businesses experience disadvantageous treatment by energy suppliers

The Institute of Directors has written to Ofgem urging them to take action to secure a well-functioning energy market for non-domestic customers.

Recent IoD data highlighted that one in five (18%) respondents encountered at least one form of negative behaviour when asked if they had experienced disadvantageous treatment by energy suppliers in the previous six months.

The most commonly reported behaviour experienced was requesting a larger share of the bill to be paid in advance (11%). This was followed by refusal to negotiate payment terms when requested to do so (6%) and refusal to renew a contract (6%).

The IoD also drew attention to members concerns over the continued ability of energy suppliers to insist on the inclusion of take or pay clauses in energy supply contracts to non-domestic customers. This practice undermines the ability of non-domestic customers to both reduce their energy consumption and to transition to alternative, low-carbon forms of energy supply.

Jonathan Geldart, Director General of the Institute of Directors, said:

“At a time when energy prices are at an all-time high, it is important that the energy regulator ensures that any unnecessary burdens for businesses are removed.

“The inclusion of take or pay clauses in energy supply contracts to non-domestic customers runs counter to the government’s messaging to business regarding the cost and environmental imperatives to reduce energy consumption. It is therefore important that Ofgem identifies and recommends the actions needed to address the concerns of business energy customers.”

The full letter is available here.

Full survey results

941 responses, conducted between 13th-29th January 2023

Have you experienced any of the following behaviours from your energy supplier in the last six months? Please select all that apply.