In short
Out-of-contract business energy rates are what some suppliers charge when your fixed-term contract ends and you have not agreed a new deal or switched. Ofgem says they are usually more expensive than fixed-term contracts. They are a variable arrangement, so you can switch to a new contract or supplier at any time.
Ask about moving off out-of-contract rates
Tell us your premises, meters and renewal date and we will reply by email with options.
What out-of-contract rates are
Ofgem describes out-of-contract rates simply: some suppliers move you onto them if your fixed-term contract ends without you agreeing to a new deal, and, like deemed rates, they are usually more expensive than fixed-term contracts.
They are the supplier's default for a customer whose agreed term has run out. You are still supplied, and your account carries on, but the price is no longer the one you negotiated. Some businesses only notice months later, when bills rise without anyone having agreed a new price.
Whether you end up on out-of-contract rates or something else depends on your original contract. Some contracts say that at the end of the term the supply moves to out-of-contract or variable rates; others say the contract rolls over onto a new fixed term. Your contract's terms, and your supplier's renewal letter, tell you which applies.
Out-of-contract, rollover and deemed: the difference
| Out-of-contract rates | Rollover (evergreen) | Deemed rates | |
|---|---|---|---|
| Triggered by | Fixed term ends with no new deal (where the supplier uses these rates) | Fixed term ends with no new arrangement and the contract renews itself | Using energy with no contract agreed, e.g. after moving in |
| Type of arrangement | Variable | A new fixed term, usually 12 months | Variable default terms |
| Ofgem on price | Usually more expensive than fixed-term contracts | May be on a higher rate | Usually higher than negotiated contract rates |
| Leaving | Switch at any time | Read the contract; microbusinesses on evergreen contracts have a 30-day cap on termination notice | Switch at any time |
Read more on deemed rates, or on leaving a rollover in how to get out of a business energy contract.
Not sure which option suits you? Ask us
Tell us about your premises and usage and we will explain the options that fit.
Why businesses end up out of contract
It is rarely a deliberate choice. Common reasons include:
- the renewal letter went to someone who has left, or to an old address
- the business assumed the contract would continue at the same price
- the renewal was left until after the end date, when the switching window had closed
- a new contract was agreed but did not start on time, leaving a gap
- a business was told it could not switch, for example because of an objection by the current supplier over an unpaid balance
Ofgem's switching guidance says your existing supplier may object to a switch, for example if you owe it money, and suggests contacting the supplier as soon as possible to resolve it. Microbusinesses have a specific protection here: suppliers must give them information about renewal prices before the contract ends, which gives you a chance to compare. See microbusiness energy rules.
How to find your out-of-contract rates
We do not publish supplier rates on this site, and out-of-contract rates vary by supplier, by region and over time. To see what you are paying:
- check your latest bill for the unit rates and standing charges now being applied, and compare them with your previous contract's rates
- check your supplier's website for its published out-of-contract or variable rates for business customers, or ask the supplier for them
- look for the date your fixed term ended, which should be on your contract, renewal letter or bills
If you searched for a particular supplier's out-of-contract rates, that supplier's own website and your bill are the reliable sources. The more useful question is how quickly you can move onto an agreed contract.
Want this looked at for your premises?
Tell us your sites, meters and renewal dates and we will reply by email with options.
How to move off out-of-contract rates
- Confirm you are out of contract. Check the end date of your last contract and the rates on your latest bill.
- Gather a recent bill for each supply, with the MPAN on the electricity bill and the MPRN on the gas bill, and your annual consumption.
- Compare quotes, including from your current supplier. Ofgem notes the best option may be with your current supplier.
- Agree a contract with a start date as soon as practical. Because out-of-contract rates are variable, Ofgem says you can switch at any time.
- Give meter readings for the changeover, then check that the first bills on the new contract use the agreed rates.
Accepting a quote is binding: there is no business energy cooling off period. Check the term, fees, the broker costs in the principal terms and what happens when the new contract ends, so you do not repeat the problem. Our guide to business energy contract renewal covers timing.
Reading your renewal letter
Your supplier's renewal or end-of-contract letter is the best warning you will get. When it arrives, check:
- the end date of your current contract and the date any switching window opens and closes
- what happens if you do nothing: a rollover onto a new fixed term, or out-of-contract rates
- the renewal prices offered, and how long they are valid for
- how to tell the supplier you are leaving, including any notice the contract requires
Microbusinesses have extra protection here. Ofgem says suppliers must give microbusinesses information about renewal prices before the contract ends, and since 1 October 2022 suppliers cannot require a microbusiness to give notice of its intention to switch except on an evergreen contract. A renewal offer is worth comparing rather than accepting by default; the price on the letter is your current supplier's offer, not the market.
If your supplier objects to a switch
Ofgem's switching guidance says your existing supplier may object to your switch, for example if you owe it money, and that you should get in touch with the supplier as soon as possible to find out what the issue is and how to resolve it. An objection can leave you on out-of-contract rates for longer, so it is worth checking your account balance before you agree a new contract.
If you think an objection or a bill is wrong, complain to the supplier first. Ofgem says micro and small businesses can get support from Citizens Advice and help with unresolved supplier complaints from the Energy Ombudsman.
How we help
Forever Communications works as an agent of Fidelity Energy, an independent business energy broker that compares a panel of 24+ suppliers (its own figure; not every supplier in the market). We collect your bills, Fidelity Energy prices them across its panel, and we help you compare quotes and terms side by side before you decide. Fidelity Energy then arranges the contract with the supplier you choose.
Fidelity Energy is normally paid commission by the supplier, included in your rates, and Forever Communications receives a share of that payment; see energy broker fees.
Contact us with a recent bill, and we can arrange quotes to move you onto an agreed contract.
Frequently asked questions
What are out-of-contract energy rates?
They are rates some suppliers apply when your fixed-term business energy contract ends and you have not agreed a new deal or switched. Ofgem says they are usually more expensive than fixed-term contracts.
Can I switch supplier if I am on out-of-contract rates?
Yes. Ofgem says that if your contract has expired and you are on out-of-contract rates, you can switch to a new supplier at any time. Your existing supplier can object in some cases, for example if you owe it money.
Is out-of-contract the same as a rollover?
No. A rollover (also known as an evergreen contract) renews onto a new fixed term, usually 12 months, and may be at a higher rate. Out-of-contract rates are a variable arrangement you can leave at any time. Your original contract says which applies at the end of the term.
Are out-of-contract rates the same as deemed rates?
No. Out-of-contract rates follow the end of your own fixed contract. Deemed rates apply when no contract was agreed at all, for example after moving into premises. Ofgem says both are usually more expensive than negotiated fixed-term contracts.
How do I avoid out-of-contract rates in future?
Note your contract end date, read the renewal terms, and compare quotes when the switching window opens a few months before the end. Microbusinesses also receive renewal price information from their supplier before the contract ends.
Still have a question about moving off out-of-contract rates?
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