What are deemed business energy rates?
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In short: Deemed or out-of-contract rates apply when your business energy contract ends and you continue consuming without signing a new deal — prices are usually much higher than fixed contract rates. Ofgem requires suppliers to notify micro-businesses before rolling onto these rates and to publish default tariff information.
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Reviewed by Kaiser Khan
Deemed rates reflect wholesale market plus supplier margin without volume discount — shops can pay 30%–50% more than their expired fixed deal.
Moving premises without closing the old contract can leave you paying deemed rates on two supplies — terminate old contracts formally on vacate dates.
New occupier rules — if you take over premises, you inherit out-of-contract supply until you contract — switch within first weeks to avoid weeks of deemed pricing.
Compare renewal offer against market — retention teams may match broker quotes if challenged. See business energy explained for deemed rate escape checklist.
Primary source: ofgem.gov.uk/information-consumers/energy-advice-businesses
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