I have been involved with electricity/gas supply companies for nine years now and would like to share some advice with the owners of start-up businesses and those which have recently relocated or are shortly to relocate.

Firstly, beware any company cold-calling you claiming to be Energywatch, the ‘local network supplier' or your current provider phoning to offer you a better deal or asking for your bank details. Do not give these details out over the phone.

New businesses, particularly start-ups, can be very naive about energy, particularly since this is often way down their list of priorities. This fact is often exploited by unscrupulous sales agencies and supply companies. It is very common for this to happen approximately three or four weeks after a business opens or starts trading. The reason for this is that these agencies buy lists of start-up businesses and use these to cold-call businesses. Because a business is on the list, they can exploit any uncertainty regarding suppliers and tariffs.

I have personally organised supply contracts for existing customers who have relocated and had a sales agency phone them saying that it is ‘null and void' because my business has gone bust and also that EDF had also gone bust.

I have taken phone calls asking me if British Gas were still trading as ‘one of their staff' had called to say all of their gas customers had to transfer to another provider for their gas. The number left with my customer to call back turned out to be the ‘national no smoking' number.

All of the suppliers are aware of this but are not doing enough to stop it. In same cases I believe that they are encouraging or at best ‘turning a blind eye' to these practices. Many of these practices have been highlighted on BBC's Watchdog.

Once a new business goes into directories, they will be plagued by cold telephone callers so be very careful who you trust. Use personal recommendations or known and trusted suppliers from someone is prepared to visit you. Phone a supplier and ask them to send a representative to see you or else phone a broker and ask them to visit you in person. It would be very difficult to assess the energy usages and needs of a business from an office 300 miles away, and even more difficult from overseas.

Do not agree to a supply contract over the phone without having first had the opportunity to see the rates in writing and check the terms and conditions.

Business electricity contracts can be up to five years long and it is unfortunately common for the advisor to neglect to inform the customer of this information. Customers phoning their present supplier may be offered a ‘reduced or discounted rate' yet this rate may be much higher than those available elsewhere.

It is also common for the written terms and conditions to be sent out many days or weeks later, long after any ‘cooling off period' has expired.

Previous articles have highlighted contractual issues relating to business energy and ‘rolling over' of customers. I believe that is time for the industry to try and stamp out ‘dodgy practices' and start to play fair and act in the interest of the consumer.

Electricity rates are at record high levels but at the moment business customers are having unnecessary restrictions placed upon them trying to get the best deal for their business.

John Lewins is director of utilities brokers and consultants Phoenix Energy (UK) Ltd. For more information see www.phoenixenergy.co.uk [1]