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Small Businesses also needs help with Rising Energy Costs

By 22nd October 2012No Comments

<br /> Adrian Burton

Posted by:
Adrian Burton

The government has stepped in to ensure energy companies provide simpler tariffs and guide consumers to where they can find best value.

However, this new initiative is aimed at the domestic market and will do nothing to assist small businesses.

Small businesses are becoming increasingly worried about their ability to pay bills and the threat of being cut off, power companies are getting more stringent on credit checks thus on occasion making transfer impossible.

In an article in ”Utility Week” dated the 12 October it highlighted that in a survey conducted by Consumer Focus calls to them from micro businesses were up 10% from 2009/10 and of these calls 61% related to issues around debt and disconnection.

In a recent ‘Which’ study as reported in the Utility week 19th October only 1 in 10 individuals were able to understand energy tariffs they were presented with and identify the cheapest tariff on the market.

Business tariffs are different to domestic and are equally as complicated. Also business contracts have to be monitored to ensure contracts are not rolled over by energy companies. Many small business owners are not aware of the small window of opportunity for the termination notice to be served on a contract, and ultimately end up paying higher prices the following year.

So it has to be recognised that the concerns the government has for consumers are equally true of small businesses, where a myriad of tariffs make it difficult to understand the best deal and strict termination rules are often not acted upon.

A further concern for businesses might be that if the Big 6 energy suppliers are having to forgo margin in the domestic market to meet the government demands then the result might be an increase on business tariffs to make up the shortfall. Resulting in even more concerns for the small business owners trying to keep their head above water.

We have already seen 3 of the big 6 announce energy price increases even before we get into the cold weather of the winter.

So the message to the government is not to stop with the consumer, but more has to be done for the small business owner if they are to remain competitive and more importantly in business.