Firms ‘duped’ into signing ‘inflated’ energy contracts

27-Feb-2023 - Last updated on 27-Feb-2023 at 10:57 GMT

Inflated contracts: Government needs to step in and tell energy suppliers to "play fair" (Credit: Getty/seanliew)

Related tags Finance Government Energy costs

The Government needs to tell energy suppliers to “stop being greedy” and allow businesses to renegotiate contracts after being “duped” into agreeing to “inflated” prices, according to one West Yorkshire-based operator.

Licensee of the Honest John Bar & Coffee Tavern in Todmorden, Daren Derrick, said businesses were “led to believe prices were going to continue to rise” before signing two or three-year contracts at higher rates.

But now prices have significantly come down, the Government needs to step in to “persuade” suppliers to renegotiate contacts.

He said: “If the Government would persuade suppliers to allow us to renegotiate contracts, we can start saving some real money and once again start investing in the trade, start employing people.

“I don't have the money to invest in [the business] because I'm working every hour God sends just to pay the electric bill.”

Really struggling

Derrick claimed the pub’s 12-month contract was currently at 57.9p a unit, but the same contract with the same energy supplier was recently advertised at 32p a unit on a comparison website.

He added: “We're all really struggling and businesses are closing down left right and centre because of these escalating and inflated prices.

“Suppliers won't entertain negotiating a new contract based on the lower rates and I just can't understand why apart from lining their own pockets.

“They need to stop being greedy and help us out."

Derrick continued he felt “really angry” and couldn’t understand why the Government would not “step in and tell suppliers to play fair”.

“I’m not asking for something for nothing, all I’m asking is to renegotiate on today's rates”, he said.

Fight tooth and nail

The operator explained rising energy costs had already resulted in staff cutbacks at the pub and forced him to “exhaust” himself working every hour he can.

He said: “'I’m exhausted, my staff are exhausted. I've got a great group of people here and they've all stepped up, they all know the situation, but we can't go on forever; we can't go on like this until my electricity contract runs out.”

Additionally, Derrick stated the sector needed clarification regarding the level of future energy support, claiming if it were to be calculated based on the current, lower energy prices “nobody would get any help”.

He added: “I appreciate the Government has an awful lot on its plate but I’ll fight tooth and nail to protect my business and my staff’s jobs.

“The support they're offering isn’t anywhere near enough to compensate us. It's a drop in the ocean.”