Many small businesses, including those in the food and retail sectors, are struggling to cope with higher energy rates despite the significant drop in energy prices since last year. This has prompted the Federation of Small Businesses (FSB) to call for an automatic option to renegotiate energy contracts for firms that meet certain criteria.
According to the FSB’s latest research, 13% of small businesses fixed their energy bills between July and December last year, with many now facing increases that could lead to closure or restructuring. The FSB is advocating for an option to renegotiate for firms that set their energy contract between 1 July and 31 December 2022, can confirm that their increase is above the price cap, and whose contract continues past April 2021.
Policy Chair, Tina McKenzie, warned that many small businesses locked in energy contracts last year to qualify for maximum government support, only to see that support disappear. She also noted that it is “disheartening” to see these companies having to contemplate closure, downsizing or restructuring as a result.
Business owners can take advantage of the proposed option to renegotiate and potentially avoid the negative effects of these higher energy bills. By staying vigilant, they can secure a better deal while maintaining the continuity of their business operations.
