Everything you need to know about exit fees
We’re often contacted by customers worried about being charged an exit fee by their current provider. In many cases, this isn’t a problem – read on to find out why.
What is an exit fee?
If you’re on a fixed tariff (where the supplier commits to keep the price you pay per unit of energy the same for a set period), then the supplier may charge an ‘exit fee’ if you leave the contract early.
Why do suppliers charge exit fees?
By promising to keep their price the same for a set time (usually 12 months), the supplier is taking on the risk that the price of the energy they buy to sell to you may go up during that time. Their reward is knowing that you’ll stay with them for 12 months, so if you leave early, they could be out of pocket.
How can I see if my supplier charges an exit fee?
When you get a quote through our website, click on the ‘more info’ section next to each result and then scroll down to your personal projection. That will tell you whether your current tariff includes exit fees (see below). Alternatively, you should be able to tell from a recent bill.
You can see the exit fee listed in the bottom row of your personal projection.
When can you be charged an exit fee?
What a lot of people don’t know is that you won’t be charged an exit fee if you apply to switch within 56 days of your current contract end date. That’s because Ofgem rules don’t let suppliers charge a fee if a switch goes live within the final 42 days of your contract, and it takes a minimum of 14 days for the switch to go live once you’ve applied to switch. So, 42 days plus 14 equals 56 days – that’s almost two months! In practice that means you’re only restricted from switching for the first 10 months of most contracts.
What if I’m not within the final 56 days?
Don’t despair! It’s still work getting a quote, as one of our suppliers, Bulb, will pay your exit fees if you switch to them. Once your switch is live, simply send them a picture of your final bill from the old supplier, showing the exit fee, and they will credit your account with the same amount.