Many UK small businesses are unknowingly paying some of the highest energy rates available. If you have recently moved premises, let a contract lapse, or never formally agreed a tariff with your supplier, there is a strong chance your business is on deemed business energy rates — and paying well above the market rate as a result.
This guide walks you through exactly how to identify whether you are on deemed rates, what information you need, and how to take action.
What Are Deemed Business Energy Rates?
When a business occupies premises without a pre-agreed energy contract, the existing supplier automatically places that business on deemed rates. This most commonly happens when a business moves into new premises, takes over a lease, or allows an existing fixed-term contract to expire without renewing.
Deemed rates are not negotiated. The supplier sets them, and they are typically far higher than standard contracted rates. They exist to ensure supply continuity, not to offer value. Many business owners do not realise they are on these rates until they receive a surprisingly large bill.
Deemed Rates Versus Out-of-Contract Rates
These two terms are often used interchangeably, but there is a practical distinction worth understanding.
- Deemed rates apply from day one of occupying premises without a contract. They cover the period before any formal agreement is reached.
- Out-of-contract rates (sometimes called rollover or deemed rollover rates) apply when a fixed-term contract ends and no new agreement has been signed. The supplier continues to supply energy but at a higher default rate.
Both situations result in elevated costs, and both are resolved in the same way: by securing a new supply contract. The key difference is the trigger point, not the remedy.
How to Check Your Current Contract Status
Before you can act, you need to confirm which type of rate you are on. Here is how to find out.
- Step 1 — Check your latest bill. Look for a section labelled "tariff type", "rate type", or "contract type". If it reads "deemed", "out of contract", "default", or "rollover", you are paying elevated rates.
- Step 2 — Log in to your supplier portal. Most major suppliers provide an online account where your contract end date, tariff name, and unit rates are displayed. If there is no contract end date, that is a warning sign.
- Step 3 — Call your supplier directly. Ask specifically: "Is my account currently on a deemed or out-of-contract rate?" Suppliers are obliged to tell you.
- Step 4 — Check your Meter Point Administration Number (MPAN) for electricity or Meter Point Reference Number (MPRN) for gas. These are printed on your bill. You will need them when comparing alternatives.
- Step 5 — Note your annual consumption. This is usually shown as kWh per year on your bill. Accurate consumption figures are essential for getting like-for-like quotes.
What Information to Gather Before Comparing
Having the right details ready will make the comparison process faster and more accurate.
- Your MPAN (electricity) and/or MPRN (gas)
- Your current unit rate and standing charge (in pence per kWh)
- Your estimated annual consumption in kWh
- Your contract end date, if one exists
- Your business address and billing address if different
- Whether you require single or dual fuel (gas and electricity together)
With these details ready, you can compare commercial energy options for your business quickly and without delays.
Action Checklist
- Locate your most recent energy bill and identify the tariff type section.
- Log in to your supplier's online portal and check for a contract end date.
- If no contract end date is shown, call your supplier to confirm your rate type.
- Write down your MPAN or MPRN, unit rate, standing charge, and annual consumption.
- Confirm whether your business uses gas, electricity, or both.
- Set a calendar reminder 60 days before any contract end date to begin comparing.
- Use Aarubi's business electricity and gas comparison to review available contracted rates.
