You’d think it would be simple to work out which energy supply category you’re under but Ofgem, as seems to be their sole raison d’etre, have once again muddied the waters with a confusing set of definitions.
With more and more people working from home or with small business set ups, business owners are increasingly being left flummoxed over whether to take up domestic or business energy contracts.
The regulator is not helping. In fact Ofgem is simply confusing matters.
After several redefinitions, a micro business is now defined as a customer who:
- Consumes 293,000kWh or less of gas a year
- Or consumes 100,000 kWh or less of electricity a year
- Or has fewer than ten employees (or their full-time equivalent)
- And has an annual turnover or annual balance sheet total not exceeding €2m
Phew, that should make things clearer for business, right?
Not really, who on earth knows how much energy they consume per annum, £ spend maybe, but kWh? Of course not. As for UK businesses knowing their turnover in Euro? The mind boggles, literally.
So fresh from a pointless, irrelevant set of definition that the business nor energy supplier can prove, disprove or frankly understand, Ofgem added a new level of a fuss over the difference between domestic customers and domestic premises. Confused yet?
According to Ofgem:
- Domestic customers are those requiring energy at domestic premises.
- Domestic premises are premises where supply is taken wholly or mainly for domestic purposes.
The difference?
Clear as mud?
According to Ofgem, mass confusion has ensued after residential landlords were unsure whether they fell under the auspices of domestic energy or commercial energy contracts, as they weren’t the actual residents of the property and so weren’t ‘customers’ but were domestic ‘premises’.
What? Did confusion really reign? Or did Ofgem simply fancy adding yet another barrier to competition in the energy markets?
No matter as Ofgem are here to the rescue to solve a problem that needlessly exists….to that end Ofgem have advised that if there’s any confusion, they’ll determine the distinction on application.
Application for what is unclear, no-one was aware that customers needed to apply to Ofgem for anything, but hey they need to justify their existence right?
So rather than letting the market do the work and enabling a domestic premise run for business purposes to choose whether they want a domestic or business energy contract, Ofgem seemingly leave it to the toss of a coin and interminable vacillation in a market they’re supposed to be fixing. Utter madness – the sign of another shining Ofgem success!