Switching energy suppliers is difficult at the best of times. Industry jargon, new rules and regulations, and complicated legalities can make the process feel impossible. Business owners who want to make the switch are up against lots of admin tasks.
At Power Compare, we are committed to explaining the complicated parts of the process. With our easy-to-understand guides, switching energy suppliers has never been easier. In this article, we walk business owners through one of the most complicated and important legal parts of switching.
What Is a Letter of Authority?
When switching energy suppliers, business owners can streamline the process by hiring an energy broker. Brokers have a comprehensive understanding of the industry and work on behalf of their customers to secure the best deal possible. To allow a broker to act on their behalf, business owners have to create a legally admissible document.
A letter of authority, which is also known as an LoA, is a legal document that outlines the parameters that brokers can act in. These parameters can include sensitive information like billing details, personal information, and account information. Lots of industries use these types of legal letters to create clear guidelines for third parties.
Why Do You Need a Letter of Authority to Switch Energy Suppliers?
Business owners do not need a letter of authority to switch suppliers. You only need to think about an LoA if you ask a third party to find and secure a new energy deal for you. They cannot switch suppliers for you without your express consent. Although LoAs might sound daunting, they are a standard industry-wide practice.
LoAs are most common amongst medium and large companies. Whereas small company owners with a few employees might be able to secure a good deal with a little research, large company owners have to consider their monthly budget on a larger scale. The smallest mistake can cost them hundreds or even thousands of pounds a month.
When it comes to switching energy suppliers, it pays to speak to the experts. If you are unsure about finding the best deal, you should get advice from an experienced broker.
Is it Safe to Sign a Letter of Authority?
There are lots of different kinds of letters of authority, all of which come with different permissions. Business energy brokers need level one LoAs, which only give them basic information. They can access information about your current energy contract, meter readings, and energy consumption with this type of authority.
Level two letters give brokers access to far more sensitive information. They also allow them to secure a new deal on your behalf. Whereas brokers in other industries will ask for level two permissions, energy brokers will never ask for this level of access to your information. Instead, they require your consent before securing a new contract and switching energy suppliers.
As with any legal contract, it is important to read the information carefully. If you are ever concerned about the language in your LoA, seek legal counsel.
How Long Is a Letter of Authority Valid for?
Most LoAs are only valid for a year. This is the industry-standard length. The length that your letter is valid for varies based on your circumstances. If you want your LoA to be valid for longer than a year, you should state it in the letter itself.
Although LoAs seem like daunting legal letters, you have full control of the contents of them. You can identify the brokers that can access them, the permissions you want to offer your broker, and how long the letter is valid for.
How Do I Write a Letter of Authority?
A letter of authority is a legally binding document. When writing an LoA, you need to use certain legal language and identify specific parameters. You can use this LoA template to help you. This standard template is fine for energy business owners who only need to provide level one access to their brokers.
It is important to remember that small mistakes can be costly. If you feel unsure about your ability to write an LoA, contact a solicitor.
Here are a few tips for business owners who want to tackle the letter themselves.
- The letter needs to be signed and dated within the last year.
- Type the letter on paper that has your company’s letterhead on it.
- Explain which permissions you are giving to your energy broker.
- Identify the person you are giving authority to.
What Happens After You Submit a Letter of Authority?
Once we have received your letter of authority, we will start processing it. When the relevant authority and permissions are live, we will delegate responsibilities to our team of energy experts. There are advisors who have years of experience on our team. They can get to work straight away and find you a tailored deal.
We will be in touch as soon as we have found a suitable new supplier. When you put your trust in our team, switching energy suppliers has never been easier.
How Long Does It Take To Get a Letter of Authority Approved?
It does not take long to approve a letter of authority. We can process an LoA in as short a time frame as ten working days. Once you have submitted your letter to us, you do not have to worry about a thing. We will contact you when the permissions are live.
Switch Energy Suppliers
We help business owners all over the UK make the switch. Switching energy suppliers can feel daunting, especially for business owners who have lots of other background tasks to think about. Our experts have years of experience in the industry, and they can match you with a supplier that fits your needs.
If you are not sure about switching energy suppliers just yet, try our comparison calculator. You can input your details and compare suppliers in under a minute. The latest deals on the market are only a few clicks away.