Energy cost challenges still impacting pubs

This, combined with lower-than-average temperatures and variable renewable generation, led to more gas demand and weaker supply.

While recent volatility has little impact on commodity costs, contract rates are markedly higher as suppliers increase risk premiums.

Pubs are at risk of higher energy costs from more than their supplier. Some operators are signing contracts with third parties who promise energy cost savings.

In one recent example, a Nationwide Energy customer signed a contract they thought was to reclaim the 20% VAT on the domestic energy use in their accommodation.

In reality, it was a four-year variable rate energy supply contract. The responsibility for managing this contract is passed to a related company that operates as a “re-biller”, managing payments for which the customer remains responsible.

In other examples, this has led to operators who don’t know who their supplier is or the rates they are on. The customer may believe they have been transferred from their existing supply contract.

This company also has the authority to agree future contracts without the customer's consent. Should the customer terminate this agreement, the re-biller contract enables them to claim all future lost commissions from the customer.

Ofgem has taken steps to regulate the broker market and provide protection for micro-businesses including many pubs. However, as the re-biller gets its commission from the customer rather than via the supplier, they are beyond the scope of current protections.

This highlights the importance of carefully reviewing any offer of services and contracts that operators are asked to sign. The support of a trusted partner mitigates many risks when reviewing your business needs.

For further advice and assistance please contact Nationwide Energy​​ on 02476 328995 or at vasb@angvbajvqr-raretl.pb.hx​.