Contracts and renewal
How business energy procurement works
What actually happens when a business buys or renews its energy?
Commercial energy procurement is a controlled buying process, not just a request for the cheapest unit rate. A useful process establishes who is buying, which supply points are included, how and when energy is used, when current contracts end and which price and service risks the organisation can accept. Only then can quotations be compared fairly and an authorised decision recorded.
Written by Energy Guide editorial team · Specialist review: Pending · Source checked:
What it means
Procurement normally moves through five stages: build a verified supply schedule, define the requirement, approach suppliers directly or through an adviser, compare whole-contract offers, and complete contract and operational handover. For a small single-site business these stages may be brief. For a multi-site or high-consumption organisation they may require formal governance and several approvals.
The supplier sells and bills the energy. A broker or consultant may gather data, approach suppliers or advise on the decision. Network and metering organisations keep distinct technical roles. The buyer should know which party is accountable for each action.
Why a decision-maker should care
Weak input data can make an apparently competitive tender unreliable. Missing meters, estimated annual consumption, inconsistent contract dates or an unclear commission basis can distort the result. A documented process also reduces the risk of an unauthorised contract, a missed renewal date or an offer being accepted without understanding pass-through costs.
Where to find the evidence
Start with recent invoices, signed contracts, supplier portals and half-hourly data. Build one row per MPAN or MPRN and attach the legal customer, physical site, current supplier, contract end date, annual consumption, meter arrangement and known operational change.
- Invoices: supply identifiers, billed consumption and charges
- Contracts: end dates, notice, price treatment and renewal provisions
- Interval or meter data: when the site consumes energy
- Internal plans: openings, closures, electrification, solar or major equipment changes
- Broker proposal: service scope, supplier coverage and total remuneration
What to ask next
Ask whether every supply has been identified, whether consumption is actual or estimated, which components of each quote can change, how any intermediary is paid, who may accept an offer and what happens after signature. Compare the estimated total cost using the same volume and assumptions for every offer.
When specialist help may be useful
Specialist support can be useful where the estate has several entities or sites, flexible purchasing is being considered, meter data is incomplete, contracts are misaligned or the organisation lacks time to run and document the exercise. Agree the specialist's authority, fees, market coverage and deliverables before work begins.
Sources
These sources support the explanation above. Check the linked source for current rules and eligibility.