TL;DR: The Hidden Truth About “Free” Energy Brokers
The Illusion: 73% of UK businesses believe energy brokers don’t charge for their services. Only 7% of businesses using brokers in 2023 reported being charged - despite commissions being embedded in virtually every contract.
The Reality: Brokers earn commission by adding “uplift” to your unit rate. If a supplier’s base rate is 22p/kWh and the broker adds 3p, you pay 25p - with the broker pocketing that 3p for every kWh you use.
The Scale: In documented cases, broker commissions have constituted 50% of total energy costs. A golf club paid £24,000 in hidden fees. A care home was quoted £68,126 before challenging it.
The Solution: Ask one question: “What is the supplier’s base rate versus your commission?” If they won’t answer clearly, walk away.
The 73% Illusion
When Ofgem surveyed 1,000 UK businesses (opens in new tab) about their energy procurement, they found 73% of businesses using brokers believed they paid nothing for the service.
This isn’t naivety. It’s the result of a business model designed to obscure how brokers make money.
How “Free” Brokers Actually Get Paid
When you use a traditional energy broker, here’s what happens:
- Suppliers provide base rates - Say, 22p/kWh
- The broker adds their commission - Called “uplift” - say, 3p/kWh
- You see only the total - You’re quoted 25p/kWh, with no breakdown
- The supplier pays the broker - From the uplift they collect from you
You never receive an invoice from the broker. The commission is invisible - extracted through every unit of energy you consume over your entire contract.
This is why it “feels” free. No separate bill. No line item. No moment where you consciously pay.
But you’re paying. Every single day.
What “Free” Actually Costs
For a typical SME using 25,000 kWh annually on a 3-year contract:
| Broker Commission | Annual Cost | 3-Year Total |
|---|---|---|
| 6-10p/kWh (predatory) | £1,500-£2,500 | £4,500-£7,500 |
| 4p/kWh (aggressive) | £1,000 | £3,000 |
| 3p/kWh (common) | £750 | £2,250 |
| 2p/kWh (standard) | £500 | £1,500 |
| 1p/kWh (transparent - Meet George) | £250 | £750 |
The business paying 4p/kWh is losing £2,250 more than one using transparent pricing - for the exact same energy from the exact same supplier.
Why Businesses Don’t Know They’re Paying
Three factors keep this hidden:
No invoice, no awareness. Unlike accountants or solicitors who send bills, broker fees are embedded in your energy rate and collected by the supplier over years. There’s no discrete payment moment.
“Free comparison” marketing. Broker websites advertise “free energy comparison” and “no cost to you.” Technically defensible - you don’t pay them directly. But the supplier payment comes from your inflated rate.
Historical lack of disclosure. Until October 2024, there was no legal requirement to disclose commission. Businesses literally couldn’t find out what they were paying. Even now, disclosure happens in contract paperwork - not when comparing quotes.
Many businesses use brokers precisely because they don’t understand energy markets. They trust the broker’s recommendation. This trust is sometimes warranted - good brokers provide genuine value. But it also creates vulnerability.
The Evidence: Documented Cases
The Golf Club: 50% Commission
Ofgem’s Non-Domestic Market Review (opens in new tab) documented a broker charging a golf club a 50% commission fee - costing the club £24,000 in hidden charges.
They had no idea half their bill was going to the intermediary (energy broker).
The Care Home: £68,126 Reduced to £12,606
A care home was quoted broker fees of £68,126. When challenged, this dropped to £12,606 - an 81% reduction. The original quote wasn’t based on cost-to-serve. It was simply what they thought they could get away with.
The £2 Billion Class Action
Harcus Parker’s energy litigation team (opens in new tab) has filed a £2 billion class-action lawsuit on behalf of up to 2 million UK businesses, alleging systematic undisclosed commissions. In extreme cases, commission reached 60% of total energy costs.
This follows the Competition and Markets Authority’s 2016 investigation (opens in new tab) which found 45% of microbusinesses stuck on expensive default tariffs, collectively overpaying by £180 million annually.
How to Find Out What You’re Really Paying
The Single Most Important Question
When speaking to any broker, ask this:
Show me the supplier’s base rate separately from your commission. What exactly am I paying you?
A good broker will answer clearly. A problematic broker will deflect or claim they “can’t” provide this.
They can. They just don’t want to.
For New Contracts (Post-October 2024)
Since 1 October 2024, Ofgem requires suppliers to disclose broker commissions (opens in new tab) in all business energy contracts. Check the “Third Party Costs” section of your contract paperwork.
The limitation: Disclosure happens at contract stage - not when comparing quotes. This is why Meet George takes a different approach: we show our 1p/kWh fee separately from the supplier’s base rate on every quote, so you can see exactly what you’re paying before you decide.
For Existing Contracts (Pre-October 2024)
- Contact your broker and ask for a commission breakdown in writing
- Compare your unit rate against current market rates - if you’re paying 28p when the market is 22p, investigate
- If you believe you were mis-sold, the Energy Ombudsman (opens in new tab) upholds 69% of broker complaints with an average award of £894
What’s Changing
The Department for Energy Security and Net Zero confirmed (opens in new tab) that Ofgem will directly regulate brokers from 2026 - including mandatory registration, conduct standards, and enforcement powers. You can track progress on Ofgem’s TPI programme page (opens in new tab).
Industry sources report 20-30% reductions in average commission rates since transparency requirements took effect. But voluntary codes have failed - only 45 of 2,200 active brokers (2%) signed up. Until mandatory regulation arrives, the onus remains on you to ask the right questions.
The Meet George Difference
We built Meet George because we believe the “free broker” model is broken.
| Factor | Traditional “Free” Broker | Meet George |
|---|---|---|
| Commission visibility | Hidden in rate | Shown separately |
| Typical commission | 2-4p/kWh | 1p/kWh |
| 3-year cost (25,000 kWh/yr) | £1,500-£3,000 | £750 |
| When you see fees | Contract signing | Quote comparison |
| Sales pressure | Commission-driven | None |
Visible Commission: We charge 1p/kWh - shown separately from the supplier’s base rate on every quote.
No Hidden Uplift: When we show you 23p/kWh total, you know it’s 22p to the supplier and 1p to us.
AI-Powered, Not Sales-Driven: Our AI assistant analyses contracts without commission incentives. No salesperson pushing you toward higher-margin deals.
The “free” broker costs you more. Every time.
The Bottom Line
The 73% of businesses who believe energy brokers are free aren’t naive. They’ve been systematically misled by a business model designed to obscure its own costs.
The question isn’t whether brokers should be paid - of course they should. The question is whether you should know what you’re paying before you agree to pay it.
We think the answer is yes.
Ready to see transparent pricing? Learn how Meet George’s commission works or explore our complete guide to hidden broker commissions.
Ready to switch the transparent way? Join the Meet George platform waitlist - no hidden margins, no sales calls, no surprises.