Broker Commission

Key takeaways

Broker commission is what a broker (a “third party intermediary”) is paid for arranging your energy contract, sometimes as an upfront fee and sometimes built into the unit rate.

Ofgem confirmed supplier requirements to clearly display broker fees in contract principal terms for contracts signed from 1 October 2024, expanding from microbusinesses to all non-domestic customers.

Ofgem also states it does not regulate energy brokers directly, which matters if you’re trying to recover historic undisclosed commissions.

What is broker commission?

Broker commission is the payment for the broker’s service.

It’s commonly charged as either:

1. a separate fee you agree with the broker, or
2. an “uplift” embedded in the unit rate (meaning you pay it over time through bills).

What must be disclosed?

Ofgem’s April 2024 announcement says suppliers must clearly display broker fees in principal terms for non-domestic contracts signed on and from 1 October 2024, and make this information available upon request.

So, in practice, you should be able to see:

1. what the broker is being paid, and
2. how that cost is presented (for example, per unit or total across the contract).

Sources

1. Ofgem: Press release on greater protection for businesses (broker fee disclosure expansion from 1 Oct 2024)
2. Ofgem: Third Party Intermediaries guidance for microbusinesses (Ofgem does not regulate brokers)