Energy brokers help thousands of UK businesses compare suppliers and secure contracts, yet many business owners are unsure how brokers are actually paid. At the same time, a growing number of people are looking at energy brokerage as a career or a side business and want to know what the earning potential really is.
This guide explains how energy broker commission works, who ultimately pays for it, how the rules have changed, and what to expect if you are thinking about becoming an energy broker yourself.
How Do Energy Brokers Get Paid?
In most cases, an energy broker is paid by the supplier, not directly by the business. When a broker places a contract, the supplier pays the broker a commission for bringing in the customer.
That commission is usually built into the contract price as an uplift. This is a small amount added to the unit rate (measured in pence per kWh), the standing charge, or both. Because the uplift is part of the price you pay for your energy, the business customer funds the commission indirectly over the life of the contract.
Some brokers instead charge a fixed fee directly to the client, particularly for large or complex portfolios. This is less common in the small and medium business market, where commission included in the price is the norm.
How Is Commission Calculated?
Commission is linked to how much energy the business uses. The basic calculation is:
- Uplift per kWh multiplied by the annual consumption, multiplied by the contract length.
For example, a business using 50,000 kWh a year on a three year contract with a small uplift per unit generates commission on 150,000 kWh in total. Larger users, longer contracts and higher uplifts all increase the amount paid. Standing charge uplifts work in a similar way, based on the number of days in the contract.
When Is Commission Paid?
Suppliers use a few different payment models:
- Upfront. Part or all of the expected commission is paid when the contract goes live, based on estimated consumption.
- In arrears (residual). Commission is paid monthly or quarterly as the customer actually uses energy.
- A mix of both. A portion is paid upfront and the remainder over the contract term.
Upfront payments are attractive for cash flow, but they often come with clawback terms. If the customer uses less energy than estimated, leaves the supplier early or the business closes, the supplier can reclaim some of the commission already paid. Residual payments are slower to build but reflect real usage and create recurring income over time.
Who Really Pays: The Business or the Supplier?
Technically, the supplier pays the broker. In practice, the cost is recovered from the business through the energy price. That is not necessarily a bad thing. A good broker can secure a better rate, better terms and a smoother switch than a business might achieve alone, and the saving can comfortably outweigh the commission. Our guide on why businesses use an energy broker instead of going direct covers the pros and cons in more detail.
The important thing is transparency. You should know that commission is included and roughly how much it adds.
What the Rules Say About Broker Commission
Ofgem has tightened the rules on how suppliers deal with brokers serving smaller businesses. Since October 2024, suppliers have had to make broker commission clear to micro and small business customers in their contract information, and they can only work with brokers who are members of a qualifying dispute resolution scheme. This means eligible businesses can see what they are paying for the broker’s service and have a route to complain if something goes wrong.
Further regulation of brokers and other third party intermediaries has also been under discussion, so standards across the industry are likely to keep rising. For honest brokers, this is welcome news, because it rewards clear pricing and good service.
Questions to Ask Your Broker
- Is commission included in the rates you are quoting me?
- How much does it add per kWh or per day?
- Are you paid the same amount whichever supplier I choose?
- Which suppliers have you compared, and why is this one recommended?
- Who do I contact if there is a problem during the contract?
A reputable broker will answer all of these without hesitation.
Thinking About Becoming an Energy Broker?
Understanding commission is the first step for anyone considering how to become an energy broker. The appeal is clear: every business needs energy, contracts renew on a regular cycle and residual commission can build into a steady income as your client base grows.
It does take work. Successful brokers need a good understanding of electricity, gas and water contracts, access to a wide panel of suppliers, reliable pricing tools and the back office support to handle quotes, contracts and renewals. Starting completely from scratch means negotiating supplier agreements yourself, which is difficult without a track record.
That is why many new brokers join an established partner programme. The E for Energy broker partner programme gives partners training, access to our supplier network, pricing and comparison tools, marketing support and a back office team that handles quotes, contracts and admin. Partners can focus on building relationships with businesses while we take care of the technical side. No prior energy industry experience is required.
Our partners introduce businesses to services including electricity procurement, gas procurement, water procurement and new connections and metering, which gives more ways to help each client and more opportunities to earn.
Frequently Asked Questions
Do energy brokers charge businesses a fee?
Most brokers serving small and medium businesses are paid commission by the supplier, which is built into the contract price. Some brokers charge a direct fee instead, usually for larger or more complex energy portfolios.
How much commission does an energy broker earn?
It depends on the uplift applied, the customer’s annual consumption and the contract length. Larger energy users and longer contracts generate more commission than small sites on short contracts.
What is commission clawback?
Clawback is when a supplier reclaims commission it has already paid upfront, for example because the customer used less energy than estimated or left the contract early.
Do brokers have to disclose their commission?
Since October 2024, suppliers must make broker commission clear to micro and small business customers. Any business can ask its broker how much commission is included in a quote.
Can I become an energy broker without industry experience?
Yes. Many brokers start through a partner programme that provides training, supplier access and back office support. E for Energy’s broker partner programme does not require previous energy industry experience.
