Right, let’s talk business energy. It’s one of those costs that quietly creeps up on you — you sign a contract, forget about it, and eighteen months later you’re paying well over the odds while your mate down the road is on half your rate. Switching sounds simple enough. But get the timing wrong, and you can end up hit with an exit fee that wipes out any savings you were chasing.
Here’s how to do it properly.
1. Know What Kind of Contract You’re Actually On
This is where most business owners come unstuck — they don’t actually know what they signed up to. There are three common setups:
- Fixed-term contract — a set rate for a set period (usually 1–5 years). Leave early and you’ll almost certainly face an exit fee.
- Rollover contract — your fixed term ended and nobody switched, so you’ve been auto-renewed onto a new (usually pricier) fixed term. These often come with their own exit penalties too.
- Deemed contract — you moved into a new premises, started using energy, and never signed anything. These have no exit fees, but the rates are eye-wateringly high — sometimes the most expensive on the market.
Dig out your latest bill or contract paperwork and find out which one you’re actually on. If you can’t find it, ring your supplier and ask them straight. You’re entitled to know.
2. Find Your Switching Window
This is the bit that trips people up. Unlike domestic energy, business energy contracts don’t let you switch whenever you fancy — there’s a specific window, and missing it is exactly how people end up with exit fees or an unwanted rollover.
Most suppliers open the switching window between 6 months and 49 days before your contract ends. Switch outside that window — too early or too late — and you risk either an early termination charge or being rolled onto a fresh contract at a worse rate.
Set a reminder now for 6 months before your renewal date. Don’t rely on the supplier to tell you — reminding you to switch away isn’t exactly in their interest.
3. Give Notice — In Writing, On Time
Once you’re in your window, you need to formally give notice that you don’t intend to renew. This has to be done in writing (email is fine, but keep proof), and most suppliers require somewhere between 30 and 90 days’ notice — check your contract for the exact figure.
Miss this step even if you’ve found a great new deal, and your current supplier can legally roll you onto a new contract or hit you with a termination fee anyway.
4. Read the Exit Fee Clause Properly
Before you do anything else, find the actual exit fee clause in your contract (usually under “Early Termination” or “Termination Charges”). It’ll typically be calculated as either:
- A fixed fee per remaining month of the contract, or
- A percentage of the remaining contract value
Knowing the real number — not a guess — lets you work out whether switching now (and eating the fee) still saves you money over sticking it out, or whether it’s worth waiting for your proper window.
5. Time the Switch to the Day
If you’re switching within your legitimate window and giving correct notice, you shouldn’t be charged an exit fee at all — that’s the whole point of doing it this way. The fee only bites when you jump ship mid-contract without going through the proper process.
So the real skill isn’t negotiating your way out of a fee — it’s not needing to pay one in the first place because you switched at the right time.
6. Be Careful With Brokers and Comparison Sites
Third-party brokers can be useful for finding rates, but some are paid commission by suppliers, which can quietly steer you toward deals that aren’t actually the best on the market. Always ask:
- Is this broker regulated / part of a recognised code of practice (e.g. Ofgem’s confidence code equivalent for business)?
- How are they paid, and by whom?
- Am I free to compare their quote against others myself?
Never let a broker submit your notice-to-terminate on your behalf without you seeing exactly what’s been sent and when.
7. Try Negotiating Before You Switch
Before you commit to moving, it’s always worth a call to your existing supplier’s retentions team. Tell them you’re switching and see what they offer to keep you. Sometimes it’s a better rate than you’d get elsewhere, sometimes it’s nothing — but it costs you a phone call to find out, and it’s leverage either way.
Quick Checklist
- Confirm your contract type (fixed, rollover, or deemed)
- Find your contract end date and switching window
- Set a reminder 6 months out
- Read the exit fee clause and notice period requirements
- Give written notice within the correct window
- Compare quotes from at least 3 sources
- Call your current supplier to see if they’ll match or beat the new deal
- Confirm the new contract’s start date lines up cleanly with your old one ending
The Bottom Line
Exit fees aren’t really a trap for switching business energy suppliers — they’re a trap for switching at the wrong time. Get your dates right, give proper written notice, and you can move suppliers cleanly without handing over a penny in penalties. It takes a bit of admin, but it’s the kind of admin that pays for itself many times over.