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Business Electricity Market Infographic

How it Works!

We're often asked how the business energy market really works and why it can be such a challenge to navigate at times. It’s easy to get quickly lost in industry jargon and confusing dead ends and a simple explanation is almost as difficult as the actual process is opaque.

Sometimes a picture is easier than words, so Business Juice have produced an infographic to explain the vagaries of the business electricity market:

business electricity market

Making Sense of Business Electricity

We asked our CEO to put his stamp on explaining the industry. Here is what he came up with:

“Anyone familiar with the Hasbro board game Frustration will already have a good idea of how the electricity market in the UK works.

“In fact the concept of working incessantly to achieve an outwardly simple goal only to get knocked off course at the very last minute is about as close a parallel to the business electricity market you can get.

“Taking that inspiration of a simple circular board game and an ostensibly simple goal we've created The business electricity market – A game of Frustration”

So there you have it, the most elaborate game of frustration imaginable. A timeline that sees:

  • Your decision to enter the market
  • Contact with your energy broker
  • Suppliers primed to deliver a price
  • Generators informing suppliers of the cost of the supply contract
  • Suppliers making margin decisions
  • National Grid levying transmission charges
  • The relevant distributor setting Distribution, metering and loss costs
  • The government applying levies
  • An array of final prices and contracts from which to choose
  • Your decision on the best contract for your business
  • Execution of a legally binding verbal contract, and
  • Winning supplier validation of the contract and credit terms agreed

All achievable within a single day, rarely more than two... Followed by anything between 1 and 6 months of no actions, no information and no focus only for following this benign period of up to 6 months.

The ‘registration window open 28 days in advance of the agreed supply start date and within that 28 day period the contract agreed all that time ago:

  • Can be rejected by the industry for incorrect data provision
  • Objected to by the outgoing supplier

Meaning just one week, or even one day before your expected start date, you can find out that your transfer of contract and supplier can have failed and you have to go back to square one to start the process all over again.

You can then see why we term it the ultimate game of frustration.

Happily though, like any experienced player of any game, you learn the tricks, understand the odds and set your strategy and tactics accordingly. That’s why Business Juice can make sense of the market madness and ensure our clients come out on top time and time again.