The single most expensive moment in a UK SME's energy year is the contract end. Miss the notice window and the meter rolls onto out-of-contract or deemed rates that typically sit well above a freshly negotiated fixed deal. The fix is calendar discipline and a few specific letters. The cost of getting it wrong, on a typical small commercial site, runs into thousands of pounds a year.
TL;DR
- Most UK business energy fixed contracts include a termination notice window, typically 60 to 90 days before the contract end date, varying by supplier and by microbusiness versus non-microbusiness status.
- Ofgem's 2022 microbusiness rule changes banned automatic rollover into a new fixed term for microbusiness customers, with the rule taking effect through the Standards of Conduct framework.
- The supplier must send a contract-end-date letter or statement of renewal terms before the window closes; the document name varies (renewal letter, statement of renewal, contract-end notification) but the legal function is similar.
- Valid termination almost always requires written notice via a specified channel (email address, postal address, or supplier portal); a phone call alone usually does not satisfy contract terms.
- The catch is timing the switch: the new supplier needs roughly 17 days under Ofgem's switching commitment, and the gap between termination notice and new supplier registration must close cleanly to avoid out-of-contract rates.
Last reviewed: May 2026
Why the contract end matters more than the rate
An SME comparing fixed energy rates often spends most of its attention on the unit rate. The contract end mechanics get less attention and cost more on average. A 1 pence per kWh difference between two competing fixed offers, on a site consuming 60,000 kWh per year, is 600 pounds over the term. A missed contract end resulting in six months of out-of-contract rates on the same site can easily exceed 1,500 pounds in additional cost, depending on the supplier's deemed or out-of-contract rate.
The asymmetry is structural. Fixed rates are set against a competitive market; out-of-contract and deemed rates are set unilaterally by the supplier under standard terms, and most suppliers price them with a substantial premium over the fresh-fixed offer.
Contract end is also the moment the broker channel is most active. The combination of an SME approaching out-of-contract exposure and the supplier sending what looks like a renewal letter creates a window where mis-priced or commission-loaded offers find purchase.
What the notice window actually looks like
UK business energy contracts vary in their notice provisions. The most common shape is a window opening 90 to 120 days before the contract end date and closing somewhere between 60 and 30 days before the end. Some suppliers operate a rolling window. Microbusiness contracts since the 2022 Ofgem rule changes have to be clearer about the window in the principal terms document.
The variations matter. A supplier requiring written notice received not less than 90 days before contract end is operating a different rule to a supplier requiring notice between 60 and 30 days before end. A supplier accepting notice via email is operating a different rule to one requiring postal notice to a named address.
Reading the contract is the only reliable way to know. The principal terms document or the contract paperwork itself states the window, the required form, and the required channel for termination notice.
For microbusiness customers, Ofgem rules require that this information be available clearly. Suppliers are bound to provide a principal terms summary at contract signature and to notify the customer of contract end approaching. The principal terms document is the source of truth.
The 2022 microbusiness rollover ban
Before 2022, automatic rollover into a new fixed term was common in the UK microbusiness market. A customer who failed to give notice within the window could find themselves locked into a fresh 12-month or 24-month fixed contract at the supplier's chosen rate, with no escape until the next contract end.
Ofgem's 2022 rule changes following the Non-Domestic Market Review made automatic rollover into a new fixed term a breach of the Standards of Conduct for microbusiness customers. The rule operates through the supply licence: a supplier rolling a microbusiness customer into a new fixed term without informed consent is in breach.
What the rule does not do is prevent the meter rolling onto deemed or out-of-contract rates if the customer takes no action. The supplier is required to continue supplying energy. Outside a fresh fixed contract, the only contractual basis for that supply is the deemed or out-of-contract terms, and those terms apply by default.
For non-microbusiness customers, the rollover protection does not apply. Larger SMEs can still face automatic rollover into a new fixed term where the contract terms permit it. The contract is the only protection, and the notice window is the only escape.
What counts as valid termination
Three elements typically have to align for valid termination. The notice must be in writing. The notice must be received within the contractual window. The notice must be delivered through the contractually specified channel.
In writing usually means email or letter. Some suppliers explicitly accept termination via online portal; some explicitly do not. A telephone call to customer service is rarely sufficient on its own, even when the service agent says otherwise, because the contract terms govern.
The window opens and closes on specific dates calculated from the contract end date. Termination received the day before the window opens, or the day after it closes, is usually invalid. Suppliers will accept terminations outside the window in some cases, particularly where the rollover ban applies, but doing so is at the supplier's discretion rather than the customer's right.
The specified channel matters more than it might appear. A contract requiring postal notice to a named address, and an email sent to a different mailbox, can be challenged by the supplier as invalid. The defence is to use the channel the contract specifies and to retain proof of delivery (recorded delivery for post, read receipt or message acknowledgement for email).
The contract-end-date letter and what to do with it
Most UK business energy suppliers send a contract-end-date letter or statement of renewal terms in the weeks before the notice window opens or closes. The letter typically states the contract end date, the renewal rate offered (a new fixed contract the supplier is willing to offer), the out-of-contract or deemed rate that applies if no action is taken, and the termination instructions.
Three things to do with the letter when it arrives.
First, diary the contract end date and the notice window. Set reminders 30 days before the window opens, on the day it opens, and 14 days before it closes.
Second, treat the offered renewal rate as a quote, not an instruction. The renewal rate is what the supplier is willing to offer. The open market is the comparison. A renewal rate that looks competitive against the broker channel may still be uncompetitive against direct-from-supplier alternatives.
Third, if switching, get the new supplier registered before the old contract ends, with the switch date timed to fall on or immediately after the contract end. The standard Ofgem switching commitment, in place across the domestic and microbusiness non-domestic market since 2024, is a 17-day switch process for eligible customers. Building margin into the timeline matters.
A clean sequence avoids the failure modes. The timeline below sets out the actions and their relative order.
| Days before contract end | Action | Notes |
|---|---|---|
| 180-150 | Begin market review, request quotes | Direct from supplier and selected brokers if used. |
| 120-90 | Receive supplier renewal letter, log notice window dates | Read contract for exact window and required channel. |
| 90-60 | Decision on supplier and contract length | LOAs limited to quote scope only at this stage. |
| 60-30 | Issue written termination via specified channel | Retain proof of delivery. |
| 30-17 | Register with new supplier | 17-day Ofgem switching window applies for eligible meters. |
| 0 | Contract ends, new supply begins | No gap, no out-of-contract exposure. |
The table is indicative; specific supplier notice windows shift the dates. A clean run on the timeline is the best defence against out-of-contract rate exposure.
What happens when the timing goes wrong
Three failure modes recur in UK SME practice.
Failure mode one: missed window, no switch in progress. The contract ends, the customer rolls onto deemed or out-of-contract rates, and stays there until a new fixed contract is arranged. Cost: typically several months of premium-priced energy. For a small office in Bristol consuming 25,000 kWh per year, a 30 percent premium on out-of-contract versus fresh fixed represents real money over a quarter. The exposure compounds with every week the customer fails to act. The supplier has no incentive to prompt a switch, because the OOC rate is the most profitable position the supplier holds against that meter. The 2022 microbusiness rules require the supplier to notify the customer that the fixed term is ending, but notification is not the same as a competitive renewal. A customer who reads the renewal letter as a fait accompli, rather than a starting point for a market check, ends up paying the supplier's preferred rate rather than the market rate.
Failure mode two: termination given outside the contractual window. The supplier rejects the termination and asserts that the contract continues (for non-microbusiness) or rolls onto deemed (for microbusiness post-2022). The dispute then sits with the supplier complaints process and, for microbusiness, the Energy Ombudsman.
Failure mode three: switch initiated late. Termination is valid but the new supplier registration date falls after the contract end, leaving a gap of out-of-contract supply. The customer pays deemed rates for the gap days. Even short gaps cost.
Here is where it breaks: the switching process is a coordination problem between three parties (old supplier, new supplier, customer) operating to different timelines, and the customer carries the financial exposure for any misalignment.
Regional context: switching in different parts of the UK
Switching mechanics are broadly uniform across Great Britain, governed by the same MPRS and central settlement infrastructure. Northern Ireland operates a separate market under the Utility Regulator NIAUR, with its own switching arrangements and supplier list.
Within Great Britain, regional differences sit in the standing charge structure and the DNO-region unit rate, both of which are passed through in the supplier's quote rather than determined by the customer. A switch in the Highlands SSEN North region carries different network cost components than a switch in the UKPN London region.
For Northern Ireland businesses, contract end mechanics broadly follow the same logic but the regulatory framework, supplier list, and switching infrastructure are administered separately. Ofgem rules do not apply north of the Irish Sea; NIAUR rules do.
Editorial disclaimer. KaelTripton is an independent UK publisher. This article is editorial, not personal financial or energy procurement advice. Rates, caps, grant levels and supplier offers move; verify any figure with the named primary source before acting on it. KaelTripton does not earn commission from suppliers or brokers mentioned.
Frequently asked questions
What is the typical notice window on a UK business energy contract?
The most common shape is a window opening 90 to 120 days before contract end and closing between 60 and 30 days before end, with exact dates set by the specific contract terms. Microbusiness principal terms documents state the window explicitly.
Does Ofgem's rollover ban mean a microbusiness cannot end up on bad rates?
No. The 2022 rule prohibits automatic rollover into a new fixed term for microbusiness, but the meter still rolls onto deemed or out-of-contract rates if no action is taken. Those rates typically sit substantially above a freshly negotiated fixed deal.
Is a phone call enough to terminate a business energy contract?
Usually not. Most UK business energy contracts require written termination via a specified channel (email address, postal address, or supplier portal). A phone call alone, even with a confirmation reference, can be challenged.
How long does a switch take under the Ofgem switching commitment?
The Ofgem switching commitment is a 17-day process for eligible meters. The countdown starts from successful registration with the new supplier and runs through to switch completion.
What is the difference between deemed and out-of-contract rates?
Deemed rates apply where there is no contract in place, typically after a customer takes over a site without signing a new supply contract. Out-of-contract rates apply where a previous contract has ended and the customer has not entered a new fixed deal. Both are set unilaterally by the supplier and both usually sit above market fixed offers.
Sources
- Ofgem - Non-Domestic Market Review, including 2022 microbusiness rule changes
- Ofgem - Energy advice for businesses, contract end and switching guidance
- Citizens Advice - Energy supply, contract end and renewal advice
- Ombudsman Services Energy - sector page and microbusiness jurisdiction
- Utility Regulator NIAUR - Northern Ireland energy regulation, separate framework
- DESNZ - Department for Energy Security and Net Zero, supplier licensing policy
