Small businesses vary significantly in their size and in their energy buying expertise.
The probe identified that the smallest businesses struggle to engage in the energy market. So, Ofgem has introduced new rules to give them better protection. The majority of small businesses in Britain are micro-businesses and Ofgem’s reforms only apply directly to these companies.
Under the new rules an energy micro-business is defined as a company which*:
- consumes less than 200,000 kWh of gas a year, or
- consumes less than 55,000 kWh of electricity a year, or
- has fewer than ten employees (or their full-time equivalent) and an annual turnover or annual balance sheet total not exceeding €2m.
A business only has to meet one of these criteria to qualify as a micro-business customer. For the full document click here.
The new rules take effect from 18th January 2010 and will apply to all new contracts entered into on or after that date. The conditions will not apply retrospectively, meaning that for customers on existing contracts, the new rules will only begin to apply when the contract is extended on, or after that date.
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