What is an energy micro businessAre you a micro business? See the definition and standards set by energy regulator Ofgem to help protect micro businesses.

Micro Business Strategic Review

Ofgem has taken the decision to implement the majority of their Micro Business Strategic Review from 1st October 2022 with one change being effective from 1st December 2022.

Ofgem consider a customer a micro business if they satisfy any one of the following criteria:

> Employs fewer than 10 employees (or full time equivalent) and has an annual turnover or balance sheet no greater than €2 million
> Consumes up to 293,000 kWh of gas per year
> Consumes up to 100,000 kWh of electricity per year

The key changes Ofgem are introducing are as follows:

> No requirement for micro business consumers to submit contract termination notice – effective from 1st October 2022.
> Ofgem require suppliers to disclose and publish within their Principal Terms for micro businesses (visible and provided pre-contract), the total pounds sterling commission to be paid to a third party over the lifetime of the contract (actual or an estimate where actual is not known) – effective from 1st October 2022.
> The Principal Terms must be explicitly provided to the micro business customer.
> For verbal contracts, the Principal Terms must be clearly explained to the micro business consumer on the call. Ofgem do not consider “signposting a consumer during a verbal sale (e.g. via an email or text message sent during the call) to a set of Principal Terms as sufficient”.
> Ofgem also require suppliers to send micro business customers a further copy of the Principal Terms post-contract acceptance within a reasonable timeframe.
> At any time on the request of the micro business consumer, Ofgem require suppliers to provide accurate information of commission paid and an updated estimate of sums to be paid in respect of the lifetime of the contract.
> Ofgem require suppliers to only work with energy consultants signed up to a Qualifying Dispute Settlement Scheme from 1st December 2022.

Before 31st March 2014

In January 2010, the energy regulator Ofgem introduced new rules covering micro business customers entering into gas and electricity contracts.

What’s a micro business?

Before 31st March 2014, Ofgem defines a micro business customer as a consumer supplied or requiring to be supplied with gas or electricity at premises other than domestic premises, with:

> an annual consumption of electricity of not more than 55,000 kWh;

> OR an annual consumption of gas of not more than 200,000 kWh;

OR

> Fewer than 10 employees (or their full time equivalent); AND an annual turnover or annual balance sheet total not exceeding €2 million.

A business only has to meet one of these three criteria to qualify as a microbusiness customer, although the consumption threshold applies to the fuel being supplied.

After 31st March 2014

For new and renewing customers after 31st March 2014, Ofgem defines a micro business customer as a consumer supplied or requiring to be supplied with gas or electricity at premises other than domestic premises, with:

> an annual consumption of electricity of not more than 100,000 kWh;

OR

> an annual consumption of gas of not more than 293,000 kWh;

OR

> Fewer than 10 employees (or their full time equivalent); AND an annual turnover or annual balance sheet total not exceeding €2 million.

> A business only has to meet one of these three criteria to qualify as a micro business customer, although the consumption threshold applies to the fuel being supplied.

If you would like a quote for your micro business then our online energy broker service can help you quickly obtain and compare energy prices online.