Why would a business’s energy supply be cut off?
Once you have compared business electricity and business gas deals and found an energy contract tailored to your business’s needs, it can be easy to take your energy supply for granted.
While most business owners do not need to think about their energy supply until they need to switch suppliers, some businesses may face the threat of having their supply being cut off if they’re unable to pay their energy bills. This is called being in arrears and refers to having outstanding debt due to missing one or more payments required by your supplier.
If you are having trouble paying your energy bills, it is important to notify your energy supplier as soon as possible. All energy suppliers have to follow regulations set out by energy regulator Ofgem on how to treat customers who have trouble paying. Cutting off gas or electricity for business customer’s is often viewed as a last resort, so energy suppliers are required to work with you to arrange a payment plan to pay off your outstanding debts at a rate you can afford.
It is important to note that failing to pay your business energy bills will impact on your business's credit rating which could limit the energy deals you are eligible for in the future. Click here for more information.
What if I can’t pay my outstanding bills?
If your outstanding bills remain unpaid, your supplier can apply for a court warrant to gain access to your meter in order to disconnect it. They will wait at least 28 days after they send your energy bill before doing so. Your supplier is also required to tell you in advance if they intend to apply for a warrant, as you may need to attend a court hearing on the issue. If the court decides to grant a warrant, your supplier must give you at least seven days’ notice in writing before they disconnect you.
If your supplier does disconnect you, they will give you contact details to discuss paying off the debt, so you can find out how to get reconnected. Your supplier may add a reconnection fee, administrative costs associated with the disconnection and reconnection, or a security deposit for the money you owe. Costs incurred by your supplier in obtaining a warrant may also be added to your bill.
If you cannot meet the requirements in your payment plan, you may need to consider switching to a prepayment meter, which takes a weekly amount from your pay-as-you-go top-ups as payment for the outstanding debt.
Other disruptions to your energy supply
Your energy supply may also be cut off due to other circumstances, many of which are beyond your control. These are typically fairly temporary disruptions, and include:
- Interruptible contract:
As a business owner, you may have signed an interruptible contract, which specifies that your energy supply may be cut off by the National Grid if they experience periods of high demand.
- Planned power cut:
Usually for planned maintenance and repairs, you may get notified that your electricity supply is about to be switched off while engineers work on electricity cables near your business premises. Unless it is an emergency, you will usually be notified in advance, and should be given a time when the power is expected back on. In a similar vein, you may experience an accidental disruption to your energy supply due to work carried out on nearby pipes and cables.
- Emergency situations:
A qualified engineer may be called in to switch off your energy supply if they have concerns about health and safety, such as someone reporting a gas leak. In an emergency situation you may not be notified beforehand of the disruption to your energy supply.
Lightning and severe winds can damage overhead power lines, while flooding and heavy rain can mean damage to underground cables. You might also find trees that are not properly trimmed can rub against and cause damage to power lines, all of which could disrupt your energy supply.
- Faulty meter or appliance:
If there is a problem with your meter, it will usually display a code or message about this fault – report this to your supplier as soon as possible. If you have a prepayment meter, you may simply have forgotten to top up.
Your electricity may also be cut off due to a blown fuse – check your fuse box or fuse board for any tripped switches, and try unplugging the faulty appliance that caused the power cut. If you can’t get your electricity back through either of these measures, you may need to call a qualified electrician.
Planning for a power cut
It might be worthwhile creating contingency plans you can implement if your power supply is cut off through no fault of your own. Some steps you can take include:
- Purchasing a back-up generator (also known as a Standby Power source) can mean you will only experience a few seconds of power outage, minimising the impact on your business.
- Alternatively, you may benefit from an Uninterruptable Power Supply (UPS) device, which is also designed to provide emergency power in the event of a power failure. UPS devices have a relatively short runtime, and usually only give you enough time to shut down your computer or equipment safely. The UPS can also be used to start a Standby Power system.
- If you have fridges or freezers in your business, keep them closed to protect perishable items – this can be effective for up to 15 hours.
- Turn off all unessential electronic devices until your power is back on.
Your business insurance may cover you if you experience loss of revenue due to your power cut. Depending on the circumstances – including the length of the power cut, any notice you were given and how often it happens – you may also be able to claim a compensation payment from your energy supplier.