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Deemed energy contracts

Deemed energy contracts offer undeniable convenience—you move into a new commercial property, and the electricity and gas are already functioning.

However, deemed contracts are also enormously expensive.

In this guide, we’ll cover exactly what you need to know about deemed energy contracts and how to avoid wasting money on your business energy bills.

What is a deemed energy contract?

A deemed business energy contract arises when your business moves into a new property and starts using electricity or gas without agreeing on a tariff with the existing supplier.

A deemed energy contract specifies how much you will pay for electricity and gas until you set up a business energy contract.

Read on below for precise terms and conditions of a deemed energy contract.

Deemed Business Energy Rates

All business energy suppliers are required to publish their deemed rates on their website.

Deemed unit and standing charge rates are typically very expensive, reflecting the uncertainty of who uses the energy and complicating the supplier’s ability to collect payments.

In 2024, the published deemed rates are between 50% and 90% more expensive than fixed energy prices.

If you have just moved into a new commercial property, we recommend switching business energy suppliers as soon as possible to avoid the costly deemed rates.

For more information, check out our full guide to dealing with your business energy when moving premises.

How do I find my deemed energy rates?

Your deemed energy rates are published on the website of your business electricity or business gas supplier.

However, a challenge arises if you are unaware of who currently supplies electricity and gas to your property. Below is a step-by-step guide to finding your deemed energy rates:

How do I find my deemed gas rates?

Use the Energy Networks’ ‘Find My Network Operator‘ tool to determine who manages the local gas network at your address.
Your gas network operator’s website will have a tool for searching your current business gas supplier and the MPRN associated with your address.
Search for “[business gas supplier name] deemed rates” to locate their published deemed rates on the supplier’s website.

How do I find my deemed electricity rates?

Use the Energy Networks’ ‘Find My Network Operator‘ tool to identify who manages the local electricity network at your address.
Visit the website of your electricity network operator, which will provide a tool that informs you about the current business electricity supplier and the MPAN associated with your address.
Search for “[business electricity supplier name] deemed rates” to locate their published deemed rates on the supplier’s website.

Terms of a deemed business energy contract

Ofgem carefully regulates the rules surrounding business energy contracts.

Each business energy supplier publishes its deemed business energy terms and conditions on its website. Here are the key terms to be aware of:

You’ll pay business electricity prices and business gas rates as published on the supplier’s website.
The deemed contract will cease to apply if you agree on a tariff with your current business energy supplier.
The deemed contract will also cease to apply if you switch to another business energy supplier.
There will be no exit fee associated with switching to a different supplier.
You can request the supplier disconnect the electricity or gas supply.

What’s the difference between deemed rates and out-of-contract rates?

All business energy suppliers publish both deemed rates and out-of-contract rates on their websites.

Out-of-contract rates, also known as “standard variable rates,” apply if you have a fixed contract with a supplier that expires without you arranging another contract.

Conversely, deemed energy rates apply when you have never had a contract with the current supplier for your property.

Typically, deemed business energy rates are more expensive than out-of-contract rates.