What is a letter of authority (LOA) for business energy?

A letter of authority (LOA) is a signed document that lets a broker or other third party deal with your energy supplier for you. It usually lets them get your contract and usage details and request quotes. Depending on the wording, it can also let them agree a contract in your name.

If you ask an energy broker for quotes, one of the first things they will ask for is a signed letter of authority. It is a short document, but it can hand over more power than people expect.

What is a letter of authority?

Citizens Advice describes a letter of authority as “a document that lets the broker act for you”. Suppliers use it as evidence that you have agreed to the broker acting for you. British Gas, for example, says it only shares your information with a third party if it receives a signed letter of authority from you.

Brokers use LOAs to:

• find your current contract end date and rates
• get your meter details and consumption history
• ask suppliers for quotes based on your real usage
• in some cases, agree or manage a contract for you

What does an LOA allow a broker to do?

Exactly what it says, and no more. The permissions are set by the wording of the letter, so two LOAs can give very different powers.

npower Business Solutions’ code for brokers says an LOA should clearly state the permissions granted, giving these examples:

• quoting and pricing for a contract
• entering into a contract
• getting historic data and billing information
• managing complaints

British Gas warns that these documents “can give a broker legal permission to agree to contracts on your behalf”. It advises reading an LOA carefully before signing, and being careful about handing over personal information and your renewal date.

Data only or authority to sign?

LOA wording allows	What it means for you
Getting data and quotes only	The broker can see your account and ask for prices, but you decide and sign any contract yourself
Negotiating and agreeing contracts	The broker may be able to commit your business to a contract, so treat it like signing the contract
Ongoing account management	The broker may deal with your supplier on billing, queries or complaints during the contract

If you only want quotes, ask for an LOA that covers data and quotes only.

What should a letter of authority include?

Suppliers set their own requirements for the LOAs they accept. npower Business Solutions’ code for brokers is a useful benchmark. As a minimum, it expects:

• a letterhead with your company name, matching the name on the contract exactly
• your company registration number, for every company named in the LOA (not needed for businesses that are not limited companies)
• the name of the person signing, in clear text
• their signature
• their position or job title
• a statement that you understand a broker fee may be payable and how it will be paid

npower also says it cannot accept an LOA given verbally, and that an LOA should be valid for no longer than two years. The exception is where you sign a supply contract, when the LOA can last until the end of that contract for contract management only.

SEFE Energy’s code of conduct says brokers should get your consent before marketing to you, and should have a signed and dated letter of authority as evidence of it.

What should you check before signing?

Use this checklist before you sign an LOA:

1. Who is named? Check the broker’s full company name, and whether they can pass your authority to anyone else.
2. What can they do? Look for words like “negotiate”, “agree”, “enter into” or “sign”. If you only want quotes, ask the broker to remove them or give you a data-only LOA.
3. Which sites and meters? Make sure it only covers the premises you want included.
4. How long does it last? Look for a clear end date.
5. How is the broker paid? Ask whether they charge you a fee or receive commission from the supplier that is included in your price.
6. Are they signed up to a dispute scheme? If you are a micro or small business, suppliers can only work with brokers who belong to a qualifying dispute resolution scheme. Citizens Advice says brokers paid by suppliers must be registered with the Energy Ombudsman or the Utilities Intermediaries Association. You can search the Energy Ombudsman’s broker register.
7. Is it signed by the right person? Only someone authorised to act for the business should sign.

How brokers should behave

Ofgem published good practice principles for brokers and comparison sites on 20 July 2026. They say a broker should explain its role, whether it searched all suppliers or only some, and how it is paid. Before you agree a contract, it should give you the principal terms, including price, contract length, renewal terms and exit fees.

Can you see what the broker is paid?

Yes. For contracts signed from 1 October 2024, suppliers must show broker fees clearly in the contract’s principal terms, for all business customers.

The supply licence also requires suppliers to give business customers, on request, information about any third-party costs they pay to a broker over the full contract. EDF, for example, has an online form for asking about the commission it pays your broker.

We are paid commission by suppliers too. It is included in the prices we quote and disclosed before you agree a contract. Read how we make money.

Does signing an LOA mean you have agreed a contract?

Not by itself, unless the LOA gives the broker authority to sign. A data-only LOA lets a broker look at your account and ask for prices. The contract is a separate agreement.

If you are a microbusiness, the supplier or broker must bring the principal terms to your attention before you enter a contract. Ofgem has said that on a phone sale, the principal terms must be clearly explained before you agree. Sending an email or text during the call is not enough.

Business energy contracts have no cooling-off period, so check everything before you agree. Our guide on cancelling a business energy contract explains why.

How do you withdraw a letter of authority?

Write to the broker saying you are withdrawing the LOA from a set date, and send a copy to each supplier it was given to. Keep a copy of what you sent.

Suppliers’ processes vary. npower Business Solutions, for example, says consent given through an LOA can be revoked at any time, with requests made by email.

Withdrawing an LOA stops the broker acting for you from then on. It does not cancel a contract that has already been agreed.

What if a broker misuses your LOA?

Complain to the broker first. If you are a micro or small business, you can take the dispute to the Energy Ombudsman once 8 weeks have passed or the broker has sent you a deadlock letter. The Energy Ombudsman handles broker disputes about sales, customer service, switching problems and charges.

If a contract was agreed without your consent, tell the supplier straight away too. In December 2024 Ofgem said Maxen Power had lacked safeguards to stop third-party representatives signing customers up without their consent. Our complaints guide explains the full process, and our guide to energy brokers covers choosing one you can trust.

Frequently asked questions