Energy Crisis Impact on Independent businesses and Call for Government Intervention

Last summer the energy supply market was chaotic with prices massively increasing and both suppliers and businesses not sure what was going to happen next. The ability for smaller retailers to negotiate new contracts was restricted with many only being offered fixed terms contract at higher prices. Please to say that our own broker partner did advise variable contracts, but we were only able to reach a few of the many thousands of businesses affected by this crisis.

Now we see wholesale prices decreasing and some normality returning. However, BIRA still has concerns about the impact on hard pressed independent retailers and the behaviour of energy suppliers. Firstly, prior to the energy crisis the difference between the whole price and the retail price was approx. 7p (i.e. a 7p mark up). Now we are seeing a 20p mark up (a 300% increase) but it is unlikely that the supplier costs have risen by that amount. We want to see OFGEM and the government take steps to address this profiteering.

Secondly, with wholesale prices falling nearly as quickly as they rose last year, we would like those retailers who signed fixed contracts last summer allowed to renegotiate with the suppliers so that the contract better reflects the true cost of energy. Once again, without intervention, the energy companies will profit considerably form others hardships

BIRA will engage both BEIS and OFGEM on this issue of energy prices, especially as the amount of government support will be reducing by almost 95% as from April. We have already joined forces with other associations regarding the ability to re-negotiate contracts.

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