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Fixed Rate Contract
Key takeaways
A fixed rate contract usually means your unit rate (and often the standing charge) is set for an agreed term.
It’s mainly about budget certainty, but you still need to confirm whether any costs are passed through separately.
Renewal and end-of-contract rules matter, especially for microbusinesses.
What is a fixed rate business energy contract?
A fixed rate contract is a business agreement where the supplier offers a set price structure for a defined period (for example 12, 24, or 36 months).
Ofgem’s business contract guidance explains how business contracts work and highlights what happens at contract end, including situations where customers can move onto deemed arrangements if they don’t agree a new deal.
What’s “fixed” (and what might not be)
Typically fixed:
- the supplier’s quoted unit rate
- and often the standing charge
May not be fixed (depending on contract):
- certain third party / pass-through costs
- some metering or industry charges
So the key question when you’re reviewing a “fixed” quote is:
Is it all-inclusive, or are any charges pass-through?
What to check before you sign
- Contract length and payment terms
- Whether prices are shown ex-VAT or inc-VAT
- Any pass-through items (ask for a list)
- Your end date, renewal process, and notice requirements (microbusiness rules can be different)
