In 2019, the UK’s energy regulator Ofgem launched a strategic review of the microbusiness market to better understand and address the issues faced by microbusinesses in the energy market.
Their findings and the measures they will introduce to help micro business customers (MBCs) engage with the energy market were announced in March 2022, and cover areas including searching for new deals, signing up to new contracts, communications with service providers and supplier switching.
What is a microbusiness?
MBCs are defined by Ofgem as having fewer than 10 employees; having an annual turnover or balance sheet no greater than €2 million and / or using no more than 100,000 kWh of electricity or 293,000 kWh of gas per year.
Broker commission transparency and banning notification requirements
Many busy businesses use brokers to help them compare the market and find a better deal on their energy. During the review, Ofgem found that a very small number of these brokers are not always transparent about their fees, which make up the commission element of their contracts.
To address this, Ofgem decided to put in place legislation to ensure that, that from October 1st, brokers must always be clear about the fees they are charging customers for their services.
Ofgem have also banned suppliers from requiring microbusinesses to provide notice of their intent to switch from October 1st.
The Ombudsman Services Alternative Dispute Resolution Scheme
Brokers that work with microbusinesses will also have to be registered with the Ombudsman Services Alternative Dispute Resolution Scheme by December 1st, which will help resolve disputes between energy suppliers/brokers and their customers. This independent, impartial service will take into account both the rules and regulations and what is fair and reasonable.
What we’re doing
Our ambition at TotalEnergies Gas & Power is to be the UK's most trusted business energy supplier for all our customers, whether they choose us directly or join us through a broker.
So as of June 27th - well ahead of the October 1st deadline - we’re pleased to announce that we’ve updated our MBC contracts and terms and conditions to include commission disclosure, as we lead the charge to provide our MBC customers with the transparency they deserve.