Tue, Jan

Figures show small firms losing out on energy deals

Figures show small firms losing out on energy deals

The Forum of Private Business (FPB) is urging firms to shop around for better energy deals after Government data showed that average electricity prices for small and medium sized firms increased by 15-17% between the third quarter of 2008 and the same period of 2009. However, prices increased by 9-11% for large businesses and by just 5% for the UK's biggest companies.

In recent research carried out by the FPB more than 84% of respondents cited rising utilities costs as a 'major concern'. It said that in addition, many small firms have contacted the FPB in recent months to report that energy companies have tied them to often expensive 'rollover' contracts with little or no warning. Others reported being unfairly handed huge back-dated bills following meter errors.

"While the big energy companies always pass on wholesale price increases in full the same cannot be said when prices fall," said the FPB's Finance Director Nick Palin. "This is the tip of the iceberg. By refusing to play fair some utilities giants have forced costs on small businesses they can ill afford."

The energy regulator Ofgem is attempting to boost competition by creating transparency in energy cost forecasts, in order to allow smaller providers to buy in advance, and increasing liquidity in wholesale markets. Following the recent price revelations it said customers can make significant savings by switching energy suppliers.

The FPB's utilities adviser Colin Beake, of Utility Options, explained: "Big businesses can afford to employ purchasing managers whose job is to ensure they get the best prices on utilities, but most small firms do not have that luxury.



Upcoming Events