- Contract Termination

Terminating Your Current Energy Contract

All energy contracts with suppliers automatically renew themselves after the initial contract term unless you terminate your agreement with them or if you have specific conditions in you’re contract that doesn’t require you to provide termination such as new rules regarding micro business in the UK (further information on the new rules).  This can mean that your energy contract will be "rolled over" into a new annual contract at an uncompetitive price as the supplier knows you can not move away from them for a minimum of 12-months.  Some supplier’s terms even allow the supplier to extend this period for up to 24-months. 

The Problem

Unfortunately in many cases customers miss their renewal date or accept price increases through inertia because they’re to busy trying to run their own business.  Unbelievably it is not the responsibility of the energy supplier to remind you that your energy contract is coming to an end and that you need to terminate with them to avoid an automatic renewal.		   Electricity Contract Termination
Terminate your energy agreement in writing
If a supplier does write to you it is normally to provide you with your renewal prices only, and normally after the minimum notice period have lapsed, so you are stuck with what ever they offer you. Let’s get one thing clear, the supplier does not want to draw your attention to the fact that they want to charge you higher prices for your new contract. These letters are often disguised and headed as follows:  

  • British Gas - “We’ll protect your new prices for two years”
  • Npower - “Secure your prices for 12 months and avoid future increases”
  • Scottish & Southern - “Electricity renewal offer”
  • EDF Energy - “Offering your business more” 

Most businesses do not recognise the importance of these letters from their suppliers. The letters do not say what percentage the increase is or how much more it will cost you.  If your supplier sends you a renewal offer, look at it immediately, it may only be valid for a short period of time.

Our advice is to reject the offer by sending a termination letter to your supplier. This will ensure that you are not locked in on the renewal prices and free to shop around for a better deal.

If you do not reject the renewal offer from your current supplier within the required termination window the supplier will deem it as an implicit and unconditional acceptance for another contract term. In short, if you do nothing you are accepting their new contract.  You will not be able to shop around for a better deal instead, stuck on higher prices weather you like it or not. 

To prevent your current supplier from automatically renewing your contract you are required to give them notice of your intention to cancel your current contract when it finishes. This will need to be done in accordance with their contract terms & conditions.

A termination letter is the best way for you to give this cancellation notice. We strongly advise that you refer to your original contract terms & conditions or contact your supplier to establish where this letter should be sent.  This will also confirm the minimum period of notice that the supplier requires normally between 30 and 120-days is standard.  It is always advisable to send this letter recorded delivery, as suppliers will often claim that they haven’t received your termination letter.

If you do not send a termination letter your current supplier will renew your contract on higher prices and prevent you from switching to another supplier offering a better deal.

If you send in your termination letter your current supplier will continue to supply your energy up until the day your current contract ends. If you switch to a better deal your new supplier will supply you from your contract renewal date onwards.

Summary

  • It is not the responsibility of the energy supplier to remind you that your energy contract is coming to an end and that you need to terminate with them to avoid an automatic renewal
  • Renewal letters are often disguised
  • Our advice is to reject the offer by sending a termination letter to your supplier
  • A termination letter is the best way for you to give this cancellation notice. We strongly advise that you refer to your original contract terms & conditions or contact your supplier to establish where this letter should be sent
  • It is always advisable to send this letter recorded delivery, as suppliers will often claim that they haven’t received your termination letter
  • Click Here for a sample termination letter or call us on 0870 710 7560 to discuss our tendering process in more details or request a call back later.
  • Is your energy contract coming to an end?  Give us a call before you renew any contract and let us find the best quote for you. 


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