How did an energy broker scam Richard Simpson's ice cream business?

An energy broker signed Richard Simpson's business up for a contract that was 70% more expensive than his previous rate, despite his initial understanding of a good deal.

What protections do small businesses lack regarding energy contracts?

Small businesses often lack protections such as a 14-day cooling-off period, a required signature, or other safeguards that are available to domestic energy consumers.

What is the UK government doing about energy broker issues?

The UK government plans to regulate all energy brokers through Ofgem, introducing protections and dispute resolution access for small businesses affected by unfair practices.

Home / Business and Economy / Ice Cream Man's Energy Nightmare

Ice Cream Man's Energy Nightmare

30 Jan

•

Summary

Energy broker locked firm into overpriced contract.
Energy Ombudsman ruled the contract unfair.
Small businesses lack protections for energy contracts.

Richard Simpson, who left offshore work to run an ice cream business in Buckie, faced a significant challenge on his first day. An energy broker offered a deal that, upon review, was found to be 70% more expensive than his current rate. Despite his concerns, the broker insisted a contract was agreed upon over the phone, leaving Simpson locked in and questioning his business's viability.

After several months of anxiety, Simpson sought help from the Energy Ombudsman. The independent body ruled the contract unfair, enabling him to switch providers and secure a fair price for his business. This experience left him frustrated by the lack of protections for small businesses compared to domestic customers, noting the absence of cooling-off periods or required signatures.

Research by Consumer Scotland indicates this is a widespread issue, with one in five Scottish firms experiencing energy contract problems. Many of these contracts are arranged through lightly regulated third-party brokers. Consumer Scotland advocates for greater regulation of these brokers due to issues with billing, metering, and disconnections.