Choosing a business energy broker requires checking Ofgem code registration, ADR scheme membership, and written commission disclosure before any contract is signed. This checklist covers the verification steps and warning signs to avoid.
Last reviewed: 12 May 2026
Why Broker Selection Matters
Not all business energy brokers operate to the same standard. The UK business energy brokerage market is not subject to the same licensing regime as financial services. Any company can call itself a business energy broker without meeting minimum competency or conduct standards unless it has voluntarily registered under Ofgem's Code of Practice for Third Party Intermediaries.
This creates significant variation in quality and conduct. Selecting a broker without checking their regulatory standing can result in paying inflated unit rates through undisclosed commission, being locked into unsuitable contract lengths, or having no access to formal redress if something goes wrong.
The following checklist covers the verifiable criteria that should be confirmed before appointing any broker.
Step 1: Confirm Ofgem Code of Practice Registration
Ofgem operates a Code of Practice for microbusiness TPIs. Brokers who have signed up to the code are committed to minimum conduct standards including commission disclosure, conflict of interest statements, and clear complaints procedures.
Ask any prospective broker directly: "Are you registered under the Ofgem Code of Practice for Third Party Intermediaries?" Request written confirmation. Ofgem maintains a list of registered TPIs on its website which can be used to verify the claim independently.
A broker who is not registered under the code is not automatically acting wrongly, but you have fewer baseline protections and no guaranteed right to the disclosure standards the code requires.
Step 2: Check ADR Scheme Membership
Alternative dispute resolution (ADR) scheme membership means you have access to the Energy Ombudsman if the broker causes you a financial loss and fails to resolve your complaint directly.
The Energy Ombudsman handles complaints from businesses with fewer than 50 employees and annual turnover below £6.5 million. Ombudsman decisions are binding on the broker and can result in financial awards to the complainant.
A broker who is not a member of an approved ADR scheme leaves you without this route. If a dispute arises, your only options are the broker's internal complaints process and civil litigation.
Ask for the name of the ADR scheme the broker belongs to and verify membership directly with the scheme before proceeding.
Step 3: Require Written Commission Disclosure
Before any contract is signed, request written confirmation of:
- The per-unit (p/kWh) commission the broker receives from the supplier on the proposed contract
- Whether any additional payments such as volume bonuses or renewal incentives apply
- Whether the disclosed rate is the full extent of the broker's remuneration
This request is reasonable for any business regardless of size. For microbusinesses, brokers registered under the Ofgem code are required to provide it. For larger businesses, a broker unwilling to confirm their remuneration in writing before signing is displaying a conduct pattern that Ofgem has identified as problematic.
Step 4: Check Contract-Length Pressure Tactics
A common conduct issue in business energy brokerage is pressure to commit to longer contract terms without adequate explanation. Brokers earn commission on the full contract term at inception or cumulatively, so longer contracts generate more revenue for the broker regardless of whether they suit your business.
Questions to ask when a long contract is recommended:
- What is the specific saving per kWh versus a 12-month contract?
- What are the termination provisions if business circumstances change?
- What is the out-of-contract rate this supplier applies if the contract rolls over?
- Has the broker compared this supplier's out-of-contract terms with alternatives?
If a broker cannot answer these questions clearly, or becomes evasive when contract length is questioned, treat it as a warning sign.
Step 5: Run a Companies House Check
Before giving any broker authority to approach suppliers on your behalf, run a basic Companies House search on the brokerage firm. Confirm:
- The company has been actively trading for a reasonable period
- There are no recent county court judgments or insolvency notices
- The registered office and trading address match what the broker has provided
This takes under five minutes and provides a basic legitimacy check. It does not confirm conduct, but it eliminates firms operating under recently created shell companies or with undisclosed adverse history.
Step 6: Ask for References from Similar Businesses
A broker handling businesses of your size and sector should be willing to provide references. A reference from a business with similar annual energy consumption, in a similar sector, with a contract placed in the last 12 months is meaningful. A reference from a large I&C customer when you are a small SME, or from several years ago, is less useful.
If a broker is unwilling to provide any references, that is notable.
Warning Signs to Avoid
The following are conduct patterns that should cause you to stop and reassess before proceeding:
- Refusal to confirm ADR scheme membership
- Refusal to provide written commission disclosure
- Pressure to sign authority to act documentation before quotes have been provided
- Claims that a tariff will expire within hours or days unless signed immediately
- Inability to name which suppliers they have panel relationships with
- Recommending a contract without explaining the out-of-contract rate that applies at the end
None of these individually means misconduct has occurred, but each is a pattern Ofgem and the Energy Ombudsman have identified in cases of poor TPI conduct.
The Authority to Act Document
When you appoint a broker, you typically sign an authority to act (ATA) document that permits them to approach suppliers on your behalf and discuss your account details. Read this document carefully before signing.
Confirm whether the ATA is limited to the current procurement exercise or grants ongoing authority. Some ATAs include automatic renewal provisions that give the broker authority to roll you into a new contract at the end of the current term. Ongoing authority provisions should be explicitly time-limited or removed.
Editorial disclaimer: The information on this page is for general guidance only and does not constitute regulated financial or energy advice. Energy pricing and regulatory requirements change. Always verify current standards directly with Ofgem and the Energy Ombudsman before appointing a broker.
Frequently asked questions
How do I check if a business energy broker is registered with Ofgem?
Ofgem maintains a list of TPIs registered under its Code of Practice on the Ofgem website. Ask the broker directly for confirmation of their registration and verify independently using Ofgem's published list before signing anything.
What is an ADR scheme and why does it matter for energy brokers?
ADR stands for alternative dispute resolution. For business energy, this is the Energy Ombudsman. If a broker is a member and causes you a financial loss that they fail to resolve through their own complaints process, you can escalate to the Ombudsman. The Ombudsman's decisions are binding on the broker and can result in financial awards.
Can a business energy broker lock me into a long-term contract without my consent?
A broker cannot sign a supply contract on your behalf without your explicit agreement. However, the authority to act document you sign when appointing a broker may contain terms that give ongoing procurement authority. Read any authority to act document carefully and limit its scope to the current procurement exercise.
What questions should I ask a business energy broker before signing?
The key questions are: Are you registered under the Ofgem Code of Practice? Are you a member of an ADR scheme? What commission do you receive on this contract, per kWh? What is the out-of-contract rate if the fixed term ends without action? Can you provide references from similar businesses?
Is it better to use a broker registered with Ofgem or go direct?
Ofgem code registration provides a baseline for conduct standards and your rights if something goes wrong. Whether using a registered broker is cheaper than going direct depends on the commission they charge versus any market access advantage they provide. Both routes require active comparison.
How we verified this
This article draws on the published guidance from Ofgem, the Department for Energy Security and Net Zero, and the relevant primary legislation listed in the Sources section. No aggregator or supplier-produced content was used as a primary source.
