Small Businesses Don’t Understand Their Energy Contracts

The Energy Research Council’s new brief “Buyer Beware: Early Contract Termination” finds that seven out of every 10 small-to-medium business owners are unaware of early termination provisions in their electricity supply contracts.

Early termination occurs when a customer locks into a contract with an electricity supplier for a start date that overlaps with an existing supply contract. ERC says energy contract termination is an increasing conflict that burdens electricity customers, suppliers and the marketplace.

ERC's research findings from an online survey of about 1,250 small-to-medium business executives also revealed that

• 21 percent believe their current supplier contract will continue on a month-to-month basis after expiration;
• 32 percent don't know if their current supplier contract includes an auto-renewal clause;
• 48 percent rate their current electricity supply contract as complex or very confusing.