The energy regulator is proposing reforms to automatic contract roll-overs and renewals in the business market. Ofgem is not looking to ban automatic roll-over contracts, but it is proposing to make a number of amendments to supply license conditions related to end of contract obligations.
When a fixed-term energy contract is due to end, a business needs to provide notice of termination to its supplier in writing. Automatic roll-overs occur in the event that a business does not take action to negotiate a new deal or switch supplier, and is instead migrated to a new contract with their existing supplier. Business energy users that are not rolled over could be subject to higher charges known as out of contract (OOC) rates. Both of these contracts are likely to come with different terms to those previously agreed and could cost much more.