So, you’re moving your business to a new location and you’re wondering what happens to your energy supply contract. Great question! In this article, we break down everything you need to know about moving business premises when it comes to your business energy supply and bill.
Do Energy Business Contracts Transfer When Moving?
If you have an existing relationship with a retail energy supplier and you are under contract at your business location, then transferring that contract could be possible depending on a few circumstances.
Utility Territory
All retail energy prices are quoted based on your location within a utility territory. So, if your new business location is in that same territory, then you might have the opportunity to transfer your contract. Contact your existing retail energy supplier or energy broker to inquire about whether your agreement can be transferred.
Energy Usage
Another important aspect to consider when moving is your energy usage at your new building compared to your existing usage. If you are moving to a bigger facility and are expecting to use more energy, then transferring your contract at the same rate could be challenging. Remember, energy suppliers pre-purchase the energy in order to offer you a fixed rate. If you are anticipating more usage, then you might need to obtain a new energy quote from your broker.
Checklist: Transferring Your Energy Contract To A New Location
When moving to a new building, it is important to remember a few items about your utility accounts and energy bill, especially if you are trying to transfer your existing energy contract. Here is a checklist of what you need to do to transfer your contract to your new business premise:
- New Utility Account Number: When you move, the local utility company will issue you a brand new utility account number. This is going to trigger a utility account drop with your existing supplier, so be sure to notify them ahead of time so you don’t get billed an early termination fee.
- Anticipated Energy Consumption: Next, your existing energy supplier will want to know how much energy you expect to use at your new location. If your operation is going to remain the same, then this can be a simple projection. If you plan to expand and add equipment, it is best to consult your energy broker about properly projecting your new usage. If your usage is similar to your old location, then your existing rate might be able to fall within the same energy usage bandwidth as your old contract and be able to be transferred.
- Letter of Authorization: You will also need to provide permission to your broker or supplier to transfer your new account to your existing contract. This can be done by signing a Letter of Authorization, or LOA, specifically granting this authority.
- New Contact: Sometimes the energy supplier may want you to execute a new contract with the new service address and utility account number(s). This is a simple process but will require your signature again.
What To Check When Moving Into The New Premises
There are several items you should check before moving to a new business location that could impact your energy bill. First, it is important to understand the utility’s commercial rate classification of the new building. Each utility company has several commercial rate classes, and each classification qualifies for different energy rates and billing tariffs. If your rate class is changing, it could mean an increase in your total utility bill.
Next, look out for inefficiencies in the building that could cause wasted energy consumption. Old HVAC systems and poorly insulated windows will cause increases in your energy consumption. It is also important to check the electric and/or gas meter. Most meters today are electronic and give accurate readings each month, but some old buildings have meters that need to be manually read. If the new location has an older meter, then you need to anticipate estimated utility billing that can throw off your financial projections and accounting.
Is Moving Premises An Opportunity To Change Energy Suppliers?
Sometimes. If you are moving to a new location that is in a different state or utility territory, then your existing supplier most likely will not be able to simply transfer your contract. Since each state and utility has different wholesale energy pricing, you will need to get a new quote from your supplier. This also allows you to get multiple quotes from other suppliers as well.
It is important to remember, however, that if you are moving to a new territory and planning on switching suppliers, then you might be exposing yourself to a hefty early termination fee. Your existing energy supplier might enforce your contract and charge you a penalty for leaving too early.
Need Help Moving?
At Diversegy, we have helped hundreds of our commercial and industrial customers through moves to new locations. We can aid you in transferring your existing supply agreement, negotiating a termination of your contract, and even getting pricing for your new location. Contact us today for help.
