Energy-contract warning for hosts
Licensees and operators are urged to be careful to avoid paying penalty fees while agreeing to energy contracts.
Energywatch said they increasingly face large penalties after falling foul of "win-back" contracts.
Energywatch and the Federation of Small Businesses (FSB) are calling for the energy regulator Ofgem to take action against the practice.
The problem comes when licensees or operators agree to switch energy supplier after they are offered a cheaper rate, but then change their mind when their original supplier offers a better deal.
In this situation, they have verbal contracts with both suppliers and are forced to pay a penalty charge to one company to leave their contract.
Energywatch's business services manager Paul Savage said: "Small businesses should be very wary of win- back calls.
"They might ask themselves why their old supplier didn't offer them such a good deal while they were still in contract with them.
"The deal may not be so good if you factor in the extra costs of terminating your new contract.
FSB energy policy chairman John Holbrow said: "Loopholes in the current gas and electricity legislation mean that small businesses have to fend for themselves."
