SMEs Think They Get Raw Deals When Buying Energy

Nearly a third of small and medium businesses think they receive an unfair deal when buying energy and other essential services, according to a new poll commissioned by the Ombudsman Services.

Just a quarter (26%) of the 600 SMEs polled by the Ombudsman Services felt they received fair treatment when seeking out and buying energy, telecommunications, and water. A greater portion thought they received poorer treatment than domestic customers of those services do.

Nearly two in five SMEs thought they lacked adequate protection from unfair practices from some providers, brokers, and price comparison sites in those markets. Only a fifth thought they were sufficiently protected.

Specifically, 41% thought they could benefit from additional support in handling disputes with providers.

Under current regulation the Ombudsman Service can only step in to investigate complaints about energy and telecommunication services if they come from individuals or microbusinesses with under 10 employees. Those rules have created a protection gap for SMEs and many business owners think they’re being ripped off.

One in 10 SMEs said they had previously experienced unfair or poor treatment when seeking out and paying for energy contracts. 17% said they had been mistreated when buying telecommunications services and 5% thought they had been badly treated or cheated in the water market.

The Ombudsman Services called for greater protection for SMEs, including an expansion of its own role.

Matthew Vickers, CEO of Ombudsman Services, said: “SMEs are the backbone of the UK economy but often lack the protection they need and deserve when using essential services.

“We feel that these gaps in protection should be addressed for the sake of the UK’s vitally important SMEs and the wider economy.”

SMEs spend an average of £5,100 on electricity and £4,100 on gas each year.

A recent analysis of commercial premises by EDF Energy, supplier of around a quarter of the UK’s businesses, found that businesses of all sizes could make significant savings in costs and carbon emissions—a total of £45 million and 147,671 tonnes of CO2 across 4,150 sites—by introducing simply efficiency measures, including LED lighting and better heat management.

Lauren Smith
Written by Lauren Smith

Lauren Smith has worked as a journalist and copywriter for most of the last decade, covering technology, energy, and consumer rights, in the US and UK.

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