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Energy Broker "Jargon" explained

Business Gas Contracts – Generally these are agreed and negotiated in years e.g. 12, 24, 36, 48 + months. However it is possible to secure any contract length you require to meet the needs of your business. Fixed or Capped Tariff Contracts- meaning your agreed contract prices will remain the same for the period of the contract. This protects you from the volatility of the gas market and gives you peace of mind that your business gas price will remain the same for the duration of the contract period. Note: Not all suppliers “fixed” prices are truly fixed – ask your Utility Helpline business advisor for more details Standard Pence Per Kilowatt Hour Contract – A contract where you are charged just the agreed pence per kilowatt hour for every unit of gas you use. Standing Charge Products – These contract costs have two elements to the charges. The first is the unit rate (p/kwh) which you are charges for any gas used. The second is the standing charge (meter asset charge, daily charge) which can be charged to you daily (p/day), monthly or quarterly. Generally these kinds of contracts are offered to low users of business gas. Flexible Products – this offers you the ability to purchase your gas in a variety of ways (not just buying the whole contract upfront at a premium). These products give you more opportunity to take advantage of current market conditions and not restricting you to making one buying decision a year (when the market could be at a high point). This kind of flexibility is usually only available to larger business gas users. Tracker Products - In much the same way as a tracker mortgage, these products will link you to a specific market index or report. These products work on the basis that historically fixing your gas closer to the month or day of delivery, will give customers access to lower prices. Again, this kind of flexibility has been restricted to larger business gas users, but some suppliers now offer these products to SME business gas users. Out of Contract or Deemed Rates – If you have no agreed contract (agreed price for a fixed period) for the supply of gas to your business but you are still using gas, then the current supplier to that property will charge you “out of contract” rates. These charges (p/kwh & or a standing charge) will be significantly higher than a standard business gas contract. These rates are usually applied when you first move into a property (as the previous occupant’s contract is not valid for your business) or if you’re current contract has lapsed and no new contract has been agreed. Assumptive Renewals & Contract Rollovers – Most business gas contracts have within their terms and conditions some form of automatic renewal clause. This allows the supplier to renew your contract for a further 12 or 24 months, without directly speaking to you or directly re-negotiating your rates. Rollover –this clause allows the supplier to roll (Extend) your business gas contract into an extended period, at the same contract prices as your previous year’s contract. Assumptive Renewals – In much the same ways the insurance industry works, prior to the end of your current business gas contract, you will be sent a contract renewal, outlining the new charges for the coming year or years. Failure to respond to this letter will result in the supplier assuming you are happy with the new terms and your contract will be automatically renewed for either a 12 or 24 month period. Contract Terminations – All business gas contracts will have a termination clause within their terms and conditions. This requires you to give written notice (some suppliers accept verbal notice) prior to the anniversary date of your current business gas contract. Termination would be given if you wish to move away from your current supplier at the end of your current contract, or simply that you do not wish to be held to the terms of the current contract or any form of assumptive renewal. All suppliers have different period in which you must serve your termination - ask your Utility Helpline business advisor for more details

Published by Utility Helpline on (modified )