No statutory cooling-off period
Business energy contracts are treated differently from domestic contracts under UK consumer law. Once a business has verbally or in writing confirmed acceptance of a contract, there is generally no automatic 14-day right to cancel, unlike many domestic and consumer agreements. Some suppliers offer a limited cooling-off window voluntarily, but this is not a legal requirement for business contracts.
This makes it important to review all terms, including the rate, contract length and exit charges, before confirming a contract rather than relying on being able to cancel afterwards.
Typical contract lengths
| Term | Typical suitability |
|---|---|
| 1 year | Businesses wanting flexibility to react to market changes |
| 2 to 3 years | Balance of rate stability and flexibility |
| 4 to 5 years | Businesses prioritising long-term budget certainty |
Early termination
Ending a business energy contract before its term expires usually triggers an early termination charge, calculated based on the remaining value of the contract or a fixed penalty set out in the terms. Suppliers apply this charge to recover the cost of pricing the contract based on the full term originally agreed.
Businesses considering an early exit, for example due to closure or relocation, should request a settlement figure from the supplier and factor this into any decision, since it can be significant depending on how much of the term remains.
Compare business energy prices
Enter your postcode and business details to compare available commercial energy prices.
Change of tenancy
When a business moves out of premises, responsibility for the energy contract typically depends on whether it gave the supplier the correct notice of vacation, usually requiring final meter readings and forwarding address details. If notice is not given correctly, the outgoing business may remain liable for charges after it has left the premises.
The incoming occupier at a site generally starts on a deemed contract with the existing supplier until they agree their own terms, and should organise a new contract promptly to avoid paying deemed rates longer than necessary.
- Give written notice of vacation including move-out date
- Take final meter readings on the departure date
- Confirm any final bill and check for termination charges if leaving mid-contract
- New occupiers should arrange their own contract as soon as possible
What a contract should specify
- Unit rates and standing charges for electricity and/or gas
- Contract start and end dates
- Renewal notice period
- Early termination charge basis
- Billing frequency and payment terms