How to get out of a 4 year contract

Astragal40

Hi All, new here and hoping someone can help. My small business is stuck in a 4 year electric contract until Jan 2027 & we desperately want out!
Main info:
-locked in what was a very good rate at the time: 40.19p and 113p/day standing charge (broker used a lot of scaremongering language about locking in 4 years to avoid energy prices which would continue to rise for years)

Prices have now come down significantly which is sickening and we're stuck paying 105% more on energy than we were in 2022. It's crippling. I know there is nothing we can do to get out of the contract unless we close the business or move premises without incurring massive costs/ fees. 

>> Does anyone know of any other ways I could get out of this? 

In addition. we've just heard that our supplier, Opus, is selling our contract to EDF in the autumn. Apparently our contract, tariff and terms will remain exactly the same which is pretty galling as we have no say in the matter. Does anyone think this change could give scope for us to have an early exit from this 4 year contract?

Thanks in advance!

Hoenir

What does your contract say? Hopefully you read the small print thoroughly prior to signing it. 

Grumpy_chap

Astragal40 said:

Hi All, new here and hoping someone can help. My small business is stuck in a 4 year electric contract until Jan 2027 & we desperately want out!
Main info:
-locked in what was a very good rate at the time: 40.19p and 113p/day standing charge (broker used a lot of scaremongering language about locking in 4 years to avoid energy prices which would continue to rise for years)

Prices have now come down significantly which is sickening and we're stuck paying 105% more on energy than we were in 2022. It's crippling. I know there is nothing we can do to get out of the contract unless we close the business or move premises without incurring massive costs/ fees. 

>> Does anyone know of any other ways I could get out of this? 

In addition. we've just heard that our supplier, Opus, is selling our contract to EDF in the autumn. Apparently our contract, tariff and terms will remain exactly the same which is pretty galling as we have no say in the matter. Does anyone think this change could give scope for us to have an early exit from this 4 year contract?

Thanks in advance!

So, if I understand correctly, the contract is for years 2023, 2024, 2025 & 2026 (give or take a month either end).
You have had 18 months at a good rate but now the "bad" part of the cycle is working against you rather than against the supplier.
The reference to paying more than 2022 is irrelevant as that would have been the case when your company signed up.
How is the rate "crippling"?  The business benefits from the certainty of the fixed rate so should have planned for these rates in the business plan covering this period.
As for the transfer to EDF, what does the contract say?  There would typically be a succession clause allowing a transfer of this nature.

DullGreyGuy

As a business there is much less nanny state interference in dealings with others, your expected to be sensible enough to read contracts or employ solicitors to and make a grown up decision on if a contract is right for you or not. 

As others have said above, there are benefits of certainty and inevitably with fixing sometimes you'll be in the money and other times you'll be out but you accept that in exchange for the certainty. Inevitably there is likely to be methods to break the contract early but are likely to be very expensive and who knows, 2025/26 may be another time where prices spike and maintaining this contract would see you back in the money. 

Annie000038

Good evening Astralgal40,
We were in the same position. (Jun 23 - we were paying £1.17 per KWH + £1.17 standing charge, having gone on a variable contract - at the end of our fixed rate at the start of Jun 23 - the bill was £1000+) - Having phoned up Opus, I reached an agreement where we would be paying were 35p per KWH and a standing charge of £1.17 per day - which was a lot better than said variable rate (but still £235+ monthly).  However, on checking our bills this year, I realised how much were over paying.  I phoned up and Opus they said I had signed up for a 2 year contract in Jun 23.  I said, that I may have signed up for this but doubted that I would have.  Anyway (a heads up for you), I asked for a recording of the 'Verbal' agreement.  They could not provide this. And so there was no evidence of said agreement.  A a result we have been allowed to leave our contract early - a year early. 
Please try this, hopefully it may work.  (We are now paying 30p per KWH and 30p daily standing charge - average price £110.00 per month)