Landlord business energy: void periods, resale and tenants

If you let commercial property, energy touches your business in three places: empty (void) periods between tenants, energy you supply to tenants through your own meter, and the energy performance of the building itself. This guide covers all three, with the rules and practical steps for each.

Who pays when a unit is empty?

When a tenant leaves, their contract usually ends, but the meter is still live. Under the Electricity Act 1989, if electricity is supplied with no contract in place, the supplier is treated as having contracted with the occupier, or with the owner if the premises are unoccupied. The Gas Act 1986 works in a similar way. In practice, the landlord of an empty unit can be billed on a deemed contract, usually at poor rates, which a law-firm summary notes can build up before the landlord notices. It also warns the rules were designed for homes, so they can catch commercial landlords unexpectedly.

What to do when a tenant leaves

1. Before the end of the lease, get final readings for every meter, signed off by you and the tenant, with photos.
2. Identify the supplier for each meter (see find your business energy supplier) and tell them the tenant has left and when.
3. Decide whether to keep supply on (needed for lighting, security, fire alarms, heating against frost) or to ask the supplier to put the meter on a void arrangement or disconnect.
4. Agree a contract in your name if supply continues, rather than letting a deemed contract start. See moving premises and deemed contracts.
5. Check whether the tenant's lease lets you recover costs, and the unpaid-bill position in who pays energy for empty commercial premises.

Worked example: six months empty

Take indicative October 2026 figures from a comparison site: an out-of-contract electricity standing charge of 254p/day, against 118.9p/day on an average small-business fixed deal. Over 182 days (about six months) the standing charge alone is 182 × £2.54 = £462.28 on deemed or out-of-contract terms, against 182 × £1.189 = £216.40 on the fixed deal. That is £245.88 more, before a single unit of electricity is used and before VAT. These figures are indicative averages; your supplier's deemed rate may differ. The point is that putting a sensible contract in place quickly has a cost-saving effect even for an empty building. See how much more deemed rates cost.

Some lease clauses let you recharge void costs to the outgoing tenant until the supplier is told they have left. Read the lease. For disputes, take legal advice.

Reselling energy to tenants

If your meter supplies a tenant and you bill them for it, you are reselling. Ofgem's maximum resale price rule, in place since 1 January 2003, caps the charge at what the reseller paid for the energy, including standing charges. But Ofgem confirmed in its October 2025 call for input that the cap currently applies only where the energy is used for domestic purposes, such as a flat. Resale to a shop, office or workshop tenant is not covered, so for commercial units the lease is what sets the terms.

That call for input asked whether the cap should be extended to non-domestic customers, either all of them or just micro and small businesses. It closed in December 2025, and we have not seen a decision, so check ofgem.gov.uk before relying on any summary. If you let a mixed building, the cap applies to the domestic part.

Worked example: sub-metered tenant

You pay a blended 25p/kWh for electricity. Your tenant's sub-meter shows 3,000 kWh for the quarter, so the energy cost you incurred is 3,000 × £0.25 = £750.00, plus a fair share of the standing charge. For a commercial tenant the law does not cap your charge at that figure, but recharging at cost and showing the sum is the fairest approach and the one least likely to cause a dispute. If the unit is a flat, the cap applies and you cannot add a mark-up. See can landlords resell energy to tenants, and take specialist advice for shared supplies or heat networks.

Giving each tenant their own supply

The cleanest answer is separate meters and separate contracts. Tenants then have their own supplier relationship and protections; you are not billing anyone, and you carry no credit risk. The cost is the meter work and the time. A new meter or a split supply may involve the network operator.

The EPC angle

If you let a commercial building in England or Wales, it must generally meet a minimum EPC rating of E. Letting below that without a registered exemption can lead to penalties of up to £150,000 in the worst cases. The government has signalled a tougher standard for larger buildings in the future, but the current rule is still E. Our EPC and MEES guide sets out the dates and penalties.

Insurance, security and safety on empty units

Keep enough energy on to run alarms, emergency lighting and frost protection, and check your insurance terms for vacant property. Energy is a small cost next to a burst pipe. If you keep supply on, record readings at the start and end of the void so you can show what was used.

Protections you have as a landlord

Where you hold the contract for a small commercial unit you will often be a microbusiness, with the protections that brings, including limits on backbilling to 12 months. If you are billed for a period after the tenant left, ask the supplier for the evidence of when the supply began and your notification date. If you cannot resolve it, see energy disputes and the Ombudsman.

Service charges and communal areas

Landlords often pay for the lighting and heating of corridors, car parks and shared toilets, then recover it through a service charge. That is different from reselling metered energy to one tenant, but the same good practice applies: keep the meter readings, show how the figure was worked out, and bill only the cost incurred. Communal supplies are often forgotten at renewal time, so list them alongside tenant meters and check the contract end date on each.

Next steps

1. List every meter in every unit with its MPAN or MPRN and supplier. Our guide to finding your MPAN and MPRN helps.
2. Add an energy handover checklist to your end-of-lease process.
3. If you recharge energy to tenants, write down how the charge is worked out, and apply the resale cap to any domestic use.
4. Check the EPC for each unit.