CMA acts to cut energy costs for small business
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Measures to reduce energy bills for small businesses are being introduced by the Competition and Markets Authority (CMA).
In an investigation it found that many tariffs for smaller businesses are not published as they are negotiated between customer and supplier, so suppliers will now have to publish all prices they offer to small businesses so they can have a better idea of what they should be paying.
It is also banning contracts which bind a business into expensive rollover terms. Suppliers will be stopped from inserting termination fees and no exit clauses for rollover periods, and there will be greater notice periods when a contract is coming to an end.
Businesses will be prompted to switch if they have been on their supplier's default tariff for at least three years.
The CMA said: "Other suppliers will be able to write to you, telling you how much money you could save if you switched to them and making it easier for you to choose the best deal for you.
"The prompting system will be closely controlled: you'll be able to opt out and there will be no irritating telephone calls, texts or emails."
Are you paying too much for your energy?
The Competition and Markets Authority (CMA) said that between 2009 and 2013 average prices offered by the "big six" companies were around 14 per cent above the "competitive level" in the SME segment.
‘This equates to SME customers paying around £500million more on an annual basis than would have been the case had competition functioned more effectively,' it said.
Due to a lack of awareness of what deals are available, confusing and inaccurate bills and the real and perceived difficulties of changing suppliers, more than 34% of businesses have never considered switching provider.
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