Deemed Energy Rates: What They Are and Why You Should Avoid Them

If you’ve ever moved into new business premises or forgotten to renew your energy contract, there’s a good chance you’ve ended up on deemed rates — and that’s never a good thing.

At PPS For Business, we’ve helped hundreds of UK companies escape these overpriced tariffs. In some cases, we’ve saved clients over £1,000 per year just by switching them to a more suitable contract.

So, what exactly are deemed rates, and how can you avoid them? Let’s break it down.

What Are Deemed Energy Rates?

Deemed rates (also known as out-of-contract rates) are the default energy prices you’re charged when:

• You move into a new commercial property and haven’t agreed a new energy contract

• Your previous contract has ended, and you haven’t renewed or switched

• You’ve never signed a formal contract with the existing supplier

These rates are significantly higher than negotiated commercial energy tariffs. They’re designed to be temporary, but many businesses don’t realise they’re on them, and end up overpaying for months.

How Much More Do You Pay on Deemed Rates?

Businesses on deemed rates can pay 30% to 100% more than those on a fixed-term contract. For a company with even modest energy usage, that can easily mean thousands of pounds wasted every year.

Here’s a quick example:

Energy Type	Contract Rate	Deemed Rate	Annual Cost Difference
Electricity	28p per kWh	45p per kWh	£3,400 more per year

(Based on average UK SME consumption)

How to Know If You’re on a Deemed Contract

If your business energy bills feel unusually high, or you’ve recently:

• Moved into new premises

• Let your contract expire

• Never formally agreed to a rate with your current supplier

It’s time to check your tariff. Your bill should show whether you’re on a deemed, out-of-contract, or default rate — if not, give us a shout and we’ll take a look for you.

Why Energy Suppliers Use Deemed Rates

Energy companies are legally required to continue supplying your business, even if you haven’t signed a contract. But they use deemed rates to cover their risk — meaning you pay more until you take action.

How PPS For Business Can Help

We make getting off deemed rates quick, easy, and stress-free. Here’s what we do:

✅ Check your current tariff and identify if you’re on deemed rates

✅ Compare quotes from over 100 trusted suppliers

✅ Secure a better deal that matches your usage

✅ Handle the full switching process on your behalf

✅ No cost to you — just lower bills

Don’t Let Deemed Rates Drain Your Profits

At PPS, we’ve seen it all. Pub chains, gyms, shops, farms, salons, and many of them didn’t realise they were on a bad deal until we stepped in. Our audits are fast, free, and often save clients thousands.

If you suspect you’re on deemed rates, or just want peace of mind, send us your latest bill and we’ll handle the rest.

Don’t pay more than you need to. Let’s fix that energy bill today.

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