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Thousands of UK Businesses Eligible for Compensation in Mis-Sold Energy Deals

Thousands of businesses across the United Kingdom could potentially be entitled to compensation due to irregularities in the sale of their energy contracts. Unlike residential consumers, most businesses in the UK require specialised energy supply contracts, typically arranged through energy brokers.

The role of these energy consultants involves negotiating with energy suppliers on behalf of businesses, striving to secure more advantageous contracts than the businesses could secure directly from the providers.

However, unlike energy suppliers, the commercial energy broker sector remains largely unregulated. Moreover, recent investigations have unveiled instances of mis-selling linked to concealed commission arrangements.

Mis-Sold Energy Deals

These improper practices encompass brokers obscuring commission structures from their clients, a situation that could influence their recommendations regarding energy suppliers. Furthermore, some brokers have failed to carry out comprehensive market comparisons.

Business owners questioning if they were misled when obtaining business energy contracts can now pursue compensation for their losses.

The investigation initiated by energy regulator OFGEM in 2020 highlighted that micro-businesses, particularly those with fewer than ten employees, were at a heightened risk of being mis-sold business energy contracts. However, these irregularities are not exclusive to small businesses.

Ofgem's findings revealed several instances where brokers and other third-party intermediaries offered only one energy deal to their clients, despite promising comprehensive market comparisons. In some cases, they concealed commission fees that could amount to as much as 50%.

Due to a lack of transparency from energy brokers, it can be challenging for businesses to identify mis-sold energy contracts. However, the dedicated team of funded litigation specialists at KWS Litigation can uncover any financial compensation that’s rightfully yours.

Substantial Potential Recourse

KWS Litigation estimates that the typical compensation claim falls within the range of £25,000 to £50,000, making it a substantial potential recourse for affected businesses.

Businesses that utilised an energy broker to source energy between 1989 and 2023 may be eligible for compensation. Notably, a claim can be filed against current business energy contracts, not solely older ones.

Ready to explore your options and how this article relates to you?

KWS Litigation is here to help you navigate the legal landscape and optimise your financial future. Contact us today to learn more.


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