Relocating your business involves a critical transition in energy services.
It’s essential to manage the change of tenancy and switch energy providers seamlessly to ensure uninterrupted operations and cost-efficiency in your new location.
When you’re in the midst of relocating your business or settling into a new property, managing an energy contract might not be at the top of your priorities. However, neglecting to set up a proper business gas and electricity agreement before moving could lead to costly energy bills.
To ensure you’re fully prepared, here’s a comprehensive guide on what to consider regarding business energy when you’re on the move.
Why do businesses relocate?
The primary driver for business relocation is company expansion, often accompanied by changes in circumstances or the conclusion of a lease agreement.
When considering a business relocation, it’s crucial to assess your commercial gas and electricity contracts to ensure you’re charged only for the energy consumed and avoid overpaying at your new location.
What occurs with your energy contracts when relocating? Upon relocating, your energy contract may either:
- Be transferred to the new location
- Be terminated, necessitating the establishment of a new contract
Relocating presents a unique opportunity to terminate your existing energy contract prematurely and explore more advantageous deals. However, it’s essential to consider your options before deciding to switch.
If your current energy agreement can be transferred, your provider likely has a specialized team to facilitate a seamless transition, ensuring everything is operational on your move-in day.
If a transfer isn’t possible, you’ll need to report a change of tenancy (COT) to your provider.
Understanding Change of Tenancy (COT) A COT occurs when a business relocates, resulting in a shift in energy supply responsibility.
- An incoming COT involves assuming control of a new supply.
- An outgoing COT involves terminating the contract at the previous premises.
Regardless of the COT type, it’s necessary to inform your energy providers about the move. As a Toucan Green customer, if your suppliers are part of our network, we can manage this process for you.
The Incoming COT Procedure:
- Complete a COT form detailing the incoming and outgoing businesses and landlord information.
- Provide a signed and dated lease agreement as proof of tenancy change.
- Suppliers will validate this information, often contacting the landlord or former tenant.
- Once verified, your business will be registered, allowing you to negotiate a new contract or seek alternative quotes.
Note that changes in business name or entity are not grounds for a COT. Suppliers recognize a COT solely for relocation purposes. Any business name or entity modifications will be updated on the existing contract, which remains valid until its expiration.
Preparing to Exit Your Current Business Premises When exiting, whether you transfer or switch energy deals, provide your supplier with a meter reading on your departure date. This ensures you’re billed only for your actual energy usage.
Inform your energy supplier about your relocation approximately one month before the move. Early notification aids in a smooth transition, enabling your supplier to either prepare your final bill or coordinate your contract transfer.
When notifying your supplier, ensure they have the following information:
- Your account number(s)
- The final meter readings and their respective dates
- The termination date of your lease or ownership at the old location
- The address and postcode of your new premises
In some instances, you might need to provide the new occupant’s details at your old premises to assist suppliers in establishing their energy supply. If unavailable, your supplier may request landlord or managing agent contact details.
Your business gas and electricity meter numbers (MPAN for electricity and MPRN for gas) are also essential. These can be found on a recent energy bill.
With Toucan Green, we streamline the transition, ensuring your old supplier is informed and your new supplier is prepared for your arrival.
Settling into Your New Business Premises If you retain your previous supplier post-relocation, communicate the new address and lease commencement date. Your supplier can then determine if they manage the energy supply at the new site.
If they do, the following steps ensue:
- Decide if you want them to supply both gas and electricity.
- Learn if your current pricing can be transferred, depending on the location and meter type.
- Provide an opening meter reading to secure an accurate quote.
Should your supplier not manage the energy at your new location, they’ll need to quote a new contract. This involves:
- Informing the current suppliers about the switch.
- Providing meter readings on the switch date.
- Allowing up to six weeks for the switch completion.
If you haven’t moved in by the switch date, you may submit the reading post-move.
Duration of Switching Business Energy Suppliers Switching suppliers doesn’t take effect until your current contract concludes. Hence, a switch initiated six months prior won’t activate until the current contract’s end.
However, early renewal, up to six months before the contract’s termination, can yield up to 20% savings compared to last-minute renewals.
Switching from out-of-contract rates typically takes three to six weeks. Toucan Green supports you throughout this process, ensuring a smooth transition.
What is a deemed contract? Deemed contracts are energy agreements that suppliers implement for businesses that occupy new premises without a prearranged fixed rate contract. Similar to out-of-contract rates, deemed rates are variable and typically rank among the highest charged by suppliers. Fortunately, you can compare quotes and switch to a fixed rate deal at any time.
Who is the cheapest business energy supplier in the UK? Energy suppliers adjust their rates according to market conditions, which is why consumer prices fluctuate with wholesale energy costs. Therefore, pinpointing the cheapest energy supplier in the UK is challenging.
However, choosing a supplier isn’t solely about cost; service quality and reliability are also crucial. Toucan Green collaborates exclusively with a panel of business energy suppliers known for excellent service and competitive rates.
Business Gas and Electricity for Tenants – FAQs As a new tenant in a commercial rental property, you’re tasked with managing and paying the energy bills, unless they’re included in your rent. By default, your energy supplier will place you on higher deemed rates unless you bring your existing energy deal.
Below are some frequently asked questions about managing business energy in rental properties:
Can I switch gas or electricity suppliers if I’m a tenant? Your tenancy agreement specifies who is accountable for the property’s energy bills. Typically, you’ll encounter one of two scenarios:
- Energy bills are paid directly to your landlord.
- You are responsible for paying the energy bills to the supplier.
What if I pay my energy bills directly to my landlord? In this case, your landlord handles interactions with the energy supplier, including selecting the supplier, setting rates, and making payments.
Your energy bill should reflect a per-unit charge and any applicable standing charge. As a tenant, you’re not liable for communal lighting charges, if present.
The energy bill may be included in your rent, service charges, or reclaimed from you. If your landlord oversees your energy bills, you cannot switch suppliers, but you can suggest they switch to potentially save money.
What if I am responsible for my business energy bills? If you pay the energy supplier directly, you’re in charge of the bills and free to switch suppliers according to your contract’s terms—remember, you can’t sign up for a new deal until your current one enters its switching window.
What do I need to look out for when relocating my business? While most suppliers facilitate smooth relocations, you may face challenges such as:
- Reconnection fees: If the previous tenant’s supply was disconnected, you might face a connection fee and security deposit. Toucan Green can assist in such situations.
- Connection fees: New premises without prior energy supply may incur a connection fee.
- Early termination fee: Moving before your current contract ends could result in an early termination fee. Check your contract terms before relocating.
Suppliers may waive early termination fees if you continue purchasing energy from them at your new location.
Energy efficiency: Conduct an independent energy audit alongside the EPC to identify potential improvements.
Feed-in tariff: If relocating solar panels, verify the feed-in tariff terms and landlord permissions.
Deemed energy rates: Avoid high deemed rates by arranging a new deal promptly. Notify the existing supplier 30 days before switching.
Will I need to relocate my energy meters? There’s no need to relocate meters when moving. However, if the new property lacks the necessary supply or meters, you’ll need installations. Contact your supplier for details.
When can I switch energy suppliers without penalty? Commercial energy contracts bind you for their full term, unlike domestic deals. You can’t switch until your current contract expires, but you should arrange a new contract during the switching window, typically one to six months before the end date.
How do I switch business energy suppliers? Switching with Toucan Green is straightforward. Provide your postcode, and our experts will find a suitable energy deal for your business.
Once you approve, we’ll coordinate the switch, ensuring a smooth transition without disruptions.
We’ll monitor your contract end dates to prevent rolling onto standard rates. To join Toucan Green, visit our website or call us with your business name and postcode.
