Third party intermediaries

They may offer a range of services, from inviting you to sign up with a particular supplier, through getting quotes, evaluating offers and recommending a supplier to providing continuing advice and support with billing, disputes, contract renewal etc.

The main benefits of dealing with third parties are access to skills and knowledge that you may not have, and access to particular types of contracts that may not be accessible to you. However the third party is acting for you and you should make sure that you understand and agree with all commitments being made on your behalf in advance.

Third party intermediaries provide an important service to businesses, but their activities are not covered by energy regulation. The quality and reliability of services provided by third parties can vary and a third party who is acting responsibly in your interests will not object to you seeking to protect your side of the relationship as suggested here. Just as with your energy supply, you should make sure you understand the terms being offered before agreeing, and should consider taking expert legal advice if necessary.

In order to get the best deal for your business out of third party intermediaries, energywatch recommends you follow these general guidelines:

• Cold callers - If you receive a cold call from somebody either promising to save you money, or threatening disconnection if you do not provide details over the phone, you should be aware that the call may be from a sales agency signing up new customers on commission. You should be aware that verbal undertakings can be legally binding and that you are under no obligation to provide any information or agree to anything until you are satisfied that the offer is genuine and is in your best interests.
• Most business supply contracts are for a fixed period, usually between 1 and 5 years and you cannot usually leave the contract early unless you pay a penalty.
• “Free services” - Whether the third party offers his services free of charge or indicates a fee, you will probably end up paying for his services through the supply contract.
• Price promises - Price is not usually closely related to the amount of fuel used, and any promises to save money need to be demonstrated and confirmed in writing, using actual consumption data, before any commitments are made. Similarly, a promise to lower your monthly direct debit payment does not on its own have anything to do with lowering your energy costs.

You should expect any third party you are dealing with who is genuinely in the business of providing independent advice and services to help you compare offers and enter into a contract, to be prepared to:

• understand your business, demonstrate qualifications and experience that are relevant to your circumstances, recommend the right solution for your business needs and provide you with references that you can check
• set out in writing the scope of services to be provided and the basis of any fees to be paid by you.
• disclose all sources of payment and other benefits to be received under the contract for securing your business – if you are paying a fee and the third party is also receiving a commission from a supplier, you should decide whether this is reasonable
• provide a written recommendation of which offer to accept, reasons for any decision not to ask specific suppliers not to tender, a comparison with other offers evaluated and an outline of the risks and costs associated with the type of contract suggested, including the period of the contract, notice period required for termination, any early termination fees and the potential for any end of contract payments e.g. for under or over consumption
• disclose the identity of the chosen supplier and not restrict your freedom to contact the supplier direct
• allow you to end the relationship at any time, given reasonable notice, if you are not happy with the services being provided
• give you the right to see the supplier’s invoice on request, so you can ensure that your payments are being credited against your consumption and that you are aware of all commission payments or discounts.