LANDLORDS need to “check the small print” if they are concerned their letting agent has switched energy supply without them realising it.
Under Ofgem rules, anyone renting a property and who is directly responsible for paying the gas and/or electricity bills, has the right to choose their own energy supplier.
It has come to light that some estate agents have “business arrangements” with energy providers and landlords could be tacitly allowing them to take over the supply of gas and electricity by signing the rental contract.
Authorisation to change the energy provider is a very tightly controlled process where energy suppliers require a signed Letter of Authority (LOA) from the contracting entity – the company name shown on the contract.
The LOA must clearly state if the third party has authority to agree and sign a new contract for supply of energy – this is the detail that landlords should be looking for in their letting agents’ contracts.
Slightly different to letting agents are managing agents who are often granted authority to sign energy contracts on behalf of their landlords as it is not something that landlords tend to like getting involved with. In this case, the managing agent would need a signed LOA to do so.
Ofgem has some useful information for landlords about this important matter as it also has the benefit of being the authority when it comes to managing energy suppliers’ ethics and malpractice in landlords/letting agents’ behaviour.