Third-party intermediary (TPI)
A third-party intermediary (TPI) is a broker, consultant or comparison service that helps businesses buy energy from suppliers.
What it is
A third-party intermediary (TPI) is anyone who sits between you and a supplier: an energy broker, consultant, or switching site. Most are paid commission by the supplier, built into your unit rate or standing charge, though some charge a fee directly instead.
Where you will see it
Brokers show up in your contract's Principal Terms, where the cost of the broker must be shown. For microbusinesses that applies to contracts from 1 October 2022, and for all non-domestic customers from 1 October 2024. The amount is a total in pounds and pence over the term, and estimates are allowed. Ofgem's guidance says that fees you pay a broker directly do not need to be declared in that way.
The rules
- Suppliers may only work with brokers who belong to a qualifying dispute scheme: microbusinesses from 1 December 2022, small businesses from 19 December 2024.
- There is no cooling-off period once a contract is agreed.
- Brokers are not yet directly regulated by Ofgem. Ofgem says it is preparing for that role but has no formal powers yet, with proposals to follow in 2027.
Why it matters
The commission can add up. Always ask what your broker is paid.
Example
If the Principal Terms show £450 of broker costs over a 3-year contract, that is £450 ÷ 3 = £150 a year, or about 41p a day (£150 ÷ 365), included in what you pay.
Ask any broker to show their commission in writing before you sign anything, including a letter of authority.
Related terms
See are brokers regulated, broker commission and choosing a broker.
Common questions on this topic
- How can I find out what my broker is paid?
- Is it cheaper to go direct or use a broker?
- How do I check whether a broker is trustworthy?
- What should I do if a broker mis-sold my contract?
- What is the difference between a broker and an energy consultant?
- What is a Qualifying Dispute Settlement Scheme for brokers?
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.