Contracts and renewals
Microbusiness energy rights explained
Short answer
You are a microbusiness for energy if you use no more than 100,000 kWh of electricity or 293,000 kWh of gas a year, or have fewer than 10 employees and no more than £2 million turnover or balance sheet. Microbusinesses get extra protections on renewals, billing, notice and complaints.
Key takeaways
- Meet any one test: under 100,000 kWh electricity, under 293,000 kWh gas, or under 10 staff and £2m.
- Microbusinesses get renewal letters, no-notice switching and a 12-month back-billing limit.
- Broker fees must be shown in the contract terms.
The definition
You only need to meet one of these:
- No more than 100,000 kWh of electricity a year.
- No more than 293,000 kWh of gas a year.
- Fewer than 10 employees (or full-time equivalent) and an annual turnover or balance sheet of no more than £2 million.
Your main protections
| Protection | What it means |
|---|---|
| Renewal letter | A Statement of Renewal Terms around 60 days before your fixed contract ends, with current and new prices and your annual use. See your renewal letter. |
| No notice to switch | Your supplier can’t make you give notice of your intention to switch. |
| Back-billing limit | No charges for energy used more than 12 months ago that you weren’t correctly billed for. See back-billing. |
| Contract information | Principal terms before you agree, and written terms afterwards. |
| Broker fees shown | Since 1 October 2024, any broker fee must be shown in the contract’s principal terms. This applies to all business contracts, not just micro. |
| Energy Ombudsman | Free dispute resolution after 8 weeks or a deadlock letter. See complaints. |
Check your status
Your annual kWh is usually on your bill or renewal letter. Suppliers normally decide your status when you sign, move or renew, so tell them if your business changes size.
Sources
- Energy Ombudsman: microbusiness definition (energyombudsman.org)
- Ofgem: Standard Licence Condition 7A
- Ofgem: Energy advice for businesses (ofgem.gov.uk)
Questions
Can I be a microbusiness for one fuel but not the other?
The consumption tests are per fuel, and the employee and turnover test applies to the business, so it is possible.
Does being a microbusiness mean I get cheaper prices?
No. It gives you protections, not a price. Prices still depend on your contract.
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