British Gas has announced it will no longer sell products that automatically commit its business customers to further fixed-term contracts.

The supplier is the first to end auto-rollover energy contracts and is now calling on others in the industry to follow suit.

“We’re committed to leading the way in making the sale of energy simple and transparent for all our customers,” said Stephen Beynon, Managing Director of British Gas Business. “Increasing numbers of our small business customers have told us they don’t like the way the energy industry automatically moves them onto new contracts, so we’ve decided we’ll lead the way and put an end to this practice for our customers.”

Here’s our guide to the changes and what they mean for you.

What’s changing?

From 1 September, British Gas will offer its new business customers fixed term energy products without automatic renewal at the end of the term.  After making changes to its billing systems, the old auto-rollover process will end for all customers by June 2014. Instead, customers will be able to choose from a range of fixed term or variable options.

Existing customers who reach the end of their contracts before June 2014 will be able to move to a non-rollover contract if they contact customer services to discuss their renewal.

Does this apply to all British Gas Business customers?

British Gas will no longer offer auto-renewal contracts to any business customer.  Its large customers that are on bespoke energy contracts aren’t affected, as these contracts don’t contain auto-renewal elements.

Does this change the rates its customers are currently being charged?

No, nothing will change until customers receive their new renewal letter.  If they don’t respond to this letter they’ll be automatically moved to a variable rate product rather than a fixed term product. However, should customers wish to renew onto a fixed rate, they can contact British Gas and agree a fixed term contract.

What does variable rate mean?

Customers have greater flexibility to choose their supplier and only need to provide 30 days notice rather than being committed to a contract for a year. This means that the price of the product isn’t fixed, and can go up or down with 30 days notice. However, customers are free to leave with 30 days notice.

Find out more about energy contracts and renewals

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