Octopus Energy finds brokers negatively impact over 3 million small businesses
- 3.2 million small businesses had a negative broker experience in the past year
- New report outlines steps to rein in energy broker market, increase transparency and drive down bills
- Comes as 78% small businesses demand broker commissions made clearer
London, 16 August 2023 - Transparency about level of commissions, a commission cap and an end to cold calls, are some steps that could be taken to bring the spiralling energy broker market under control, a new report by Octopus Energy for Business reveals.
The report - Small businesses in the dark: Energy brokers and the hidden scandal in energy prices - paints a disturbing picture of the prevalence of this behaviour, at a time when everything should be done to bring down energy bills.
This comes as new data shows 3.2 million small businesses had a negative experience with a broker in the last year*.
The damaging practices range from concealing commissions, locking businesses into unsuitable energy contracts, cold calling with aggressive sales tactics, posing as energy suppliers, and more.
The lack of transparency in the market has meant that eight in ten (78%) of small businesses are demanding that brokers’ commission is clearly stated at the point of sale and seven in ten (70%) want a cap on broker commissions.
Octopus - which has 60,000 business customers - is calling for immediate action to protect small businesses’ interests. While the Government and Ofgem are looking into energy suppliers’ work with brokers, brokers themselves aren’t regulated directly.
It proposes three ways to make business energy more transparent:
- No more hidden broker commissions and introducing a cap on commissions
- An end to unsolicited contact from brokers
- For energy brokers themselves to be properly regulated
Zoisa North-Bond, CEO of Octopus Energy for Business, said: “The pandemic, inflation and the cost of living crisis have increased pressures on small businesses to colossal levels. It’s simply not right that some energy brokers have been capitalising on this. The business energy market has become the wild west, and bad broker behaviour is running rampant.
“It’s fundamental we raise awareness of these damaging practices - and there are things that can be done now to drastically improve transparency in the market. We need to stand up for small businesses to help drive down bills - and we need to get moving today.”
Notes to editors:
The full report - Small businesses in the dark: Energy brokers and the hidden scandal in energy prices - can be found at this link
*YouGov nationally representative survey between 23- 28 June polling 1,000 small businesses in the UK (small business was here defined as a business with less than 50 employees).
Please note: any population estimate calculations have been carried out by Octopus Energy, using Government figures for the number of small businesses in Britain (5.47 million). As this YouGov survey found 59% of small businesses had negative experiences with brokers in the last 12 months, this amounts to 3.2 million when looking at small businesses nationwide.
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Octopus Energy for Business
Octopus Energy for Business launched in 2018 to provide companies with future-proof energy services, supplying them with 100% renewable and fairly priced power. The team supplies 60,000 customers, the majority of which are SMEs but also large organisations. For more information, check out our website.
About Octopus Energy Group
Octopus Energy is a global energy and technology group, driving the affordable, green energy system of the future. Its operations span 14 countries and the entire energy value chain. The group invests in, builds and flexibly manages renewable energy, operating a £6 billion portfolio of projects – one of Europe’s largest.
Octopus serves 5.3 million customers through its retail arm, and has licensed its advanced data and machine learning platform, Kraken, to support 30 million customer accounts worldwide through licensing deals with energy companies, including EDF, E.ON and Origin Energy.
Kraken enables Octopus to drive the electrification of heat and transport through smart tariffs and innovative cleantech. Backed by pension funds, investors and energy giants, Octopus Energy Group businesses deliver cheaper, greener energy and cutting-edge tech to countries and customers worldwide.
For more information, check out our website.
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