Business Energy Guide To A Change Of Tenancy

Whether you're moving into a new business premises or preparing to exit your current location, one thing is clear: properly managing your business energy contract during a change of tenancy (COT) is critical. It’s not just about flipping the switch at your new site; it’s about protecting your business from unexpected charges, legal complications, and costly disruptions.

In the UK, failing to notify your supplier or switch contracts in time can leave you paying inflated deemed rates or dealing with complex supplier disputes. Fortunately, it doesn’t have to be a hassle. This practical guide walks you through every step, so you can stay in control, avoid hidden costs, and transition your energy smoothly, without the stress.

Why a Change of Tenancy Affects Your Energy

Your business energy contract is tied to the property address, not the business itself. This means that when the occupier changes, the energy supplier treats it as a new agreement, even if the same company moves to a new location.

Here’s why this matters:

• You could be placed on expensive “out-of-contract” or “deemed” rates.
• The incoming or outgoing party might still be liable for charges if the switch isn't documented correctly.
• Suppliers require formal notice and documentation to acknowledge a tenancy change.

Understanding Deemed Rates vs Contract Rates 

When your business moves into new premises without signing a new deal, you’re automatically placed on deemed rates. To understand the different types of rates and how they affect your bottom line, it's essential to have a solid grasp of business energy tariffs explained.

Typical Cost Difference 

• Deemed Rate Example: 42p/kWh
• Fixed Contract Rate Example: 28p/kWh

That difference, multiplied over months or years, can cost businesses thousands.

Key Takeaway: Don’t settle for the default; switch to a proper contract as soon as possible.

Moving Into a New Premises 

Starting fresh in a new location comes with a clean slate, but not when it comes to energy. Before you even plug in your kettle, there’s one crucial step to take: avoid falling into the deemed rates trap.

Deemed Rates Apply Until You Act 

When you take over a new site, you don’t inherit the previous tenant’s energy deal. Instead, the current supplier automatically places you on a deemed or out-of-contract rate, a temporary tariff that’s often much more expensive than negotiated contracts.

These inflated rates can quickly eat into your cash flow, especially for energy-intensive businesses. That’s why prompt action is key.

Here’s what you need to do:

• Identify the existing supplier – Ask the landlord or use the MPAS (Meter Point Administration Service) if it’s not listed on site.
• Contact the supplier right away – Provide your move-in date, business name, and any relevant contact details.
• Record and submit opening meter readings – This confirms your official start date for billing purposes.
• Compare business energy quotes and secure a new deal – Lock in a tariff that suits your usage and budget.

💡Pro Tip: Act fast. Many suppliers will backdate your new contract to your move-in date, but only if you switch within the first 30 days. That could mean significant savings on your first bill.

How to Compare Business Energy Deals Quickly 

Don’t let jargon or too many options delay your energy decision. Here’s how to cut through the noise:

• Compare rates from multiple suppliers (unit rate + standing charge)
• Choose the right contract type: fixed-rate for budget certainty, variable for flexibility
• Check contract length: 1–3 years is standard
• Review supplier reputation: support matters if issues arise
• Consider extras: green energy options, billing support, payment terms

Understanding the factors that influence these rates, such as UK wholesale gas & electricity prices, can help you make a more informed decision.
💡ExpertCompare Tip:
Don’t spend hours researching, use our free quote tool to get supplier-matched rates in minutes.

Moving Out of a Premises 

Just because you’re packing up doesn’t mean your energy obligations end with the keys. To protect your business from surprise charges, you need to formally close your account and document everything properly. This process is a key part of business energy contract termination.

Final Meter Readings Are a Must 

Before leaving a site, take accurate final meter readings (or ensure your commercial smart meter is properly submitting data) and notify your supplier in writing. This ensures that your billing stops on the correct date and you're not held liable for energy used after you’ve vacated.

Here’s what to provide:

• Your official move-out date
• Final meter readings (with photos, if possible)
• The name and contact details of the new occupier (if known)

Failing to submit this information could result in your business being charged long after you've moved out. Taking five minutes now could save you hours of dispute resolution later.

What Is a COT Notification? 

A Change of Tenancy (COT) notification is a formal communication sent to your energy supplier to inform them that your business has either moved into or vacated a commercial premises. It serves as the official record of occupancy change and ensures the correct party is billed from the appropriate date.

What to Include in Your COT Notice 

• Date of move-in or move-out
• Business name and registration number
• Full address of the property
• Meter Serial Numbers (MSNs) or MPANs
• Final or opening meter readings
• Contact details of the incoming or outgoing tenant

Templates and Examples: COT Notification Letter 

Sending a clear, well-written COT notice not only helps avoid billing disputes but also ensures a faster, smoother transition between outgoing and incoming account holders. It provides your supplier with all the key details needed to process the change without delays.

Sample COT Email

Subject: Change of Tenancy Notification – [Property Address]

Dear [Supplier Name],

I am writing to inform you of a change of tenancy at the business premises located at [full address].

Move-in/Move-out Date: [dd/mm/yyyy]
Business Name: [Company Name]
Registration Number: [Company No.]
Final/Opening Meter Reading: [Reading + Date]
Meter Serial Number or MPAN: [If known]

         Please confirm the closure or setup of the account accordingly.

         Kind regards,
        [Your Full Name, Job Title, Contact Details]

📎 Tip: Send by email and request written confirmation.

What If You’re Taking Over a Vacant Premises? 

It’s common for new businesses to take over properties that have been empty. In these cases:

• Contact the supplier immediately to check if the meter is live
• Verify MPAN/MPRN details with the landlord or by checking the meter itself
• Avoid reconnection delays; disconnected sites may require site visits
• Request historical usage data to better estimate your energy needs

If there’s a previous balance on the account, clarify in writing that your business isn’t responsible.

Can I Switch Suppliers During a Change of Tenancy? 

Yes, and in most cases, a change of tenancy is the perfect opportunity to secure a better energy deal. Since you're not tied to the previous contract at your new premises, you're free to explore the market and switch suppliers right away without early exit fees or restrictions. This flexibility can lead to substantial savings from day one.

Why You Should Switch Promptly 

• Avoid expensive default rates
• Access new customer deals
• Choose tariffs that match your actual usage

Legal & Compliance Considerations 

Energy contracts carry legal weight, so even small businesses can’t afford to overlook the fine print. Whether you're a sole trader or part of a growing enterprise, handling your change of tenancy incorrectly can expose your business to penalties, disputes, or ongoing liabilities.

Here are a few key points to keep in mind:

• Store written copies of all agreements – Including your initial contract, COT notice, and any related correspondence.This is especially important for financial records, as you'll need them for tax purposes, so be sure to understand VAT on commercial energy.
• Log all communications – Especially those involving termination, renewal notices, or billing adjustments.
• Understand your obligations – Particularly if your business is merging, dissolving, relocating, or subletting the premises.

If your contract includes exit clauses, broker commission terms, or multi-site agreements, it’s wise to seek legal guidance or consult an energy broker. Clarity now prevents costly issues later.

Do Landlords Ever Handle the Energy? 

In some commercial properties, landlords handle energy as part of a serviced lease. If this applies to your business:

• Clarify who holds the energy account
• Review your lease for energy-related clauses
• Ensure you’re not unknowingly being charged premium rates

A Step-by-Step Checklist for COT 

If You’re Moving In: 

• Locate the existing supplier (call the MPAS service if unsure)
• Submit a COT notification
• Take opening meter readings
• Compare and switch to a better deal
• Set up direct debits or billing preferences

If You’re Moving Out: 

• Notify the supplier of your move-out date
• Provide final meter readings
• Share details of the new occupier
• Keep proof of communications
• Confirm closure of your account in writing

Conclusion: Simplify Your Energy Move 

A change of tenancy doesn’t have to be stressful or complicated. With the right preparation and timely action, you can avoid costly surprises, ensure a smooth switch between occupiers, and even take advantage of better energy deals tailored to your new usage needs.

The key to success lies in clear, proactive communication between your business, your energy supplier, and, if applicable, your landlord or energy broker. When everyone is aligned, the risk of billing errors, delays, or legal complications is greatly reduced.

Whether you're moving in, moving out, or managing multiple sites, a structured approach gives you the upper hand. Don’t leave it to chance. Plan early. Act quickly. Stay informed and stay in control of your energy costs.

Glossary of Business Energy Terms 

• MPAN (Meter Point Administration Number): The unique number for electricity supply points.
• MPRN (Meter Point Reference Number): The gas supply equivalent of MPAN.
• Deemed Rate: A high-rate energy tariff applied when no contract is in place.
• Standing Charge: A daily fee just to have access to energy, regardless of usage.
• COT Notification: A formal notice to inform the supplier of a business move-in or move-out.

Summary Points 

• A change of tenancy resets the energy contract at a business property.
• Deemed rates apply until you set up a new deal; these are more expensive.
• Notifying your supplier early prevents billing disputes.
• Moving premises is a chance to secure a better energy deal.
• Legal documentation and broker support can reduce your risk.

FAQs 

Q1: What happens if I don’t notify my supplier of a move?

A1: You may remain liable for charges even after you’ve moved out. The supplier won’t close the account until they receive formal notice and meter readings.

Q2: Can I keep my old energy contract at the new premises?

A2: No. Energy contracts are tied to property addresses, not businesses. You'll need to start a new contract at the new site.

Q3: How do I find out who the current supplier is?

A3: Use the Meter Point Administration Service (MPAS) or contact your landlord or property manager.

Q4: Do I have to stick with the existing supplier when moving in?

A4: No. You can switch immediately upon occupancy, even before your first bill arrives.

Q5: Should I use a broker during a change of tenancy?

A5: It’s a smart move. Brokers can help you compare rates quickly, handle paperwork, and ensure legal compliance, especially helpful for multi-site or high-usage businesses.