Can I switch business energy supplier if I owe money to my current one?
Often not straight away. A supplier can object to a business switch while you owe it money under the contract, so you generally need to clear the debt, agree a payment arrangement, or formally dispute the bill before the switch will go through.
Why debt can stop a switch
Ofgem confirms that for business customers the usual valid grounds for a supplier to object to a switch are an unexpired fixed term and debt, provided your contract allows it (Ofgem objections decision). Citizens Advice puts it plainly for small businesses: you cannot shop around while you owe your supplier money, but once the debt is cleared switching is usually worth considering (Citizens Advice).
Read your contract terms to see how debt is defined. Citizens Advice says you usually have around 28 days to pay a bill before it counts as a debt, but your contract sets the actual period.
Your options
Pay the arrears
The cleanest route. Once the balance is paid, ask the new supplier to resubmit the switch.
Agree a payment arrangement
Contact the supplier before things escalate. Citizens Advice says your supplier should help you reach a solution. Get any agreement in writing and ask the supplier directly whether it will still object to a switch while the plan runs. We have not found a rule that settles this, so treat the supplier's written answer as the deciding factor. See payment plans for business energy.
Dispute the bill
If you believe the debt is wrong (an estimated bill, a billing error, a faulty meter), dispute it in writing with evidence. A disputed amount is different from an undisputed one. See disputing a high bill.
Which contract are you on?
| Situation | What it means for switching |
|---|---|
| Fixed term, debt, term not ended | Two possible grounds for objection |
| Out of contract or deemed, debt | No exit fee, but debt may still block the switch |
| Fixed term ended, no debt | Switch should go ahead |
Worked example
A café owes £640 on its latest electricity bill and is on a deemed rate. It pays £200 now and agrees to clear the remaining £440 over two months. It cannot assume a switch is possible until the supplier confirms the balance is settled or it has agreed not to object. Paying the £440 early lets it switch sooner, and each month on deemed rates can cost far more than a fixed deal (see how much more deemed rates cost).
Warning signs to act on
- Supplier says it will seek a warrant: it can only apply at least 28 days after the bill and should tell you at least 21 days before applying, according to Citizens Advice.
- Disconnection notices. See can a supplier disconnect my business.
A new supplier may also credit-check you or ask for a deposit, so past arrears can affect the quote.
Next steps
- Ask your supplier for an itemised statement of what is owed.
- Pay, arrange a plan, or dispute in writing.
- Get written confirmation that the account is clear before re-applying.
For wider help, read what to do if you can’t pay your business energy bills.
Sources
General information only. Energy prices, rules and supplier terms change; check the latest position with your supplier, Ofgem or the Energy Ombudsman before you act.