If you are a business owner in the UK and you are looking to switch energy suppliers, you may be asked by your new supplier to provide a letter of authority. This may seem like an unnecessary hassle, but there are good reasons why UK businesses need a letter of authority when switching energy suppliers. In this blog post, we'll explore why this is the case.
What is a letter of authority?
A letter of authority is a document that gives permission for someone else to act on your behalf. In the context of switching energy suppliers, it is a document that gives your new supplier permission to communicate with your current supplier and to access your energy usage data.
Why do UK businesses need a letter of authority when switching energy suppliers?
There are a few reasons why UK businesses need a letter of authority when switching energy suppliers:
1. Data protection
Under the General Data Protection Regulation (GDPR), businesses are required to protect personal data, including energy usage data. This means that your current supplier cannot share your energy usage data with your new supplier without your permission. By providing a letter of authority, you are giving your new supplier permission to access your energy usage data, while also ensuring that your data is being handled in accordance with GDPR regulations.
2. Contractual obligations
When you sign up with an energy supplier, you agree to a contract that outlines the terms and conditions of the agreement. This contract may include provisions related to switching suppliers, such as a notice period or early termination fees. By providing a letter of authority, you are demonstrating that you have the authority to switch suppliers and that you are aware of any contractual obligations that may be in place.
3. Verification
Your new supplier may require a letter of authority as a way to verify your identity and confirm that you have the authority to switch suppliers. This helps to prevent fraud and ensures that the energy supply is being switched to the correct business.
How to provide a letter of authority
When switching energy suppliers, your new supplier will typically provide you with a template letter of authority that you can use. This letter will include your business name, address, and other relevant details, as well as a statement giving your new supplier permission to communicate with your current supplier and access your energy usage data. You will need to sign and date the letter and return it to your new supplier.
In conclusion, while it may seem like a hassle to provide a letter of authority when switching energy suppliers, it is an important step in ensuring that your energy usage data is being handled in accordance with GDPR regulations, that you are aware of any contractual obligations, and that your identity is verified. By taking the time to provide a letter of authority, you can help to ensure a smooth transition to your new energy suppliers.
How can PSP help?
The energy terms found on your business energy bills can be very confusing and we understand the difficulties this can bring to business owners. We understand these challenges and will work with businesses to ensure that they fully understand their bills and to make better informed decisions when it is time to renew their contracts.