For many clubs, energy contracts aren’t something that gets reviewed every month. With events to run, members to look after, and finances to manage, it’s easy for renewal dates to slip by unnoticed.
But what actually happens if your club doesn’t agree a new energy contract in time?
The short answer: you’ll likely be placed on an out-of-contract rate — and it can be extremely expensive.
Let’s break down what that means and why it matters for your club.
What Is an Out-of-Contract Energy Rate?
When a fixed-term energy contract comes to an end and no new agreement has been arranged, the supplier will automatically move the property onto out-of-contract pricing, sometimes referred to as deemed or rollover rates.
This is a temporary rolling arrangement, but it is not designed to offer competitive pricing. In most cases, these rates are substantially higher than contracted prices and can also be variable, meaning they may change without much notice. Suppliers apply these rates as a default position, not as a cost-saving solution.
Why Are Out-of-Contract Rates So High?
Energy suppliers structure fixed contracts around commitment. When a club agrees to a set term, suppliers can purchase energy in advance and manage risk more effectively.
Without that commitment, the supplier carries more uncertainty. To offset this, they apply a premium to out-of-contract pricing. These rates are typically based on short-term market conditions, which are often higher and more volatile.
For clubs working within tight operational budgets, even a short period on out-of-contract rates can result in hundreds or thousands of pounds in avoidable extra costs.
The Impact on Clubs
Clubs vary significantly in size, structure and energy usage. Some operate from smaller premises with limited opening hours, while others run large facilities with bars, kitchens, event spaces and extensive lighting systems. Heating demands during colder months can also be substantial. No two clubs use energy in exactly the same way.
However, regardless of size, most clubs operate within carefully managed and often tight budgets. Unlike large commercial businesses, clubs are typically member-led organisations where surplus income is reinvested back into facilities, events and the community. This means there is far less room to absorb unexpected cost increases.
When a club is placed on out-of-contract rates, the financial impact can therefore be disproportionate. Even a relatively small increase in unit rates can translate into a noticeable strain on cash flow. For larger clubs with higher consumption, the effect can escalate quickly. In many cases, clubs do not realise they are out of contract until higher bills begin to arrive — by which point unnecessary costs may already have built up.
Can You Move Away from an Out-of-Contract Rate?
The good news is that you are not locked into a long-term agreement when on out-of-contract pricing. However, switching still requires careful management.
A new contract must be agreed, supplier timelines must be handled correctly and any necessary notice periods must be observed. Delays or administrative oversights can extend the time spent on expensive rates. Without proper support, clubs can unintentionally remain on high pricing for longer than necessary.
How Do You Know If Your Club Is Out-of-Contract?
Many clubs are unsure of their contract status. A sharp increase in unit rates, unusually high bills or uncertainty around renewal dates can all indicate that a contract has ended.
If your agreement has not been reviewed in over 12 months, or you cannot easily locate your current terms, it is worth investigating. Often, clubs only discover they are on out-of-contract rates when a detailed bill review takes place.
How Club Assure Can Help
At Club Assure, we specialise in supporting clubs with cost management, and energy is one of the most common areas where savings can be made.
We monitor renewal dates, negotiate competitive fixed contracts and help ensure clubs do not slip onto expensive out-of-contract pricing. Our team provides clarity, transparency and practical guidance so your club can plan ahead with confidence.
A simple review of your current energy position could prevent unnecessary overspending and protect your club’s financial stability.
If you are unsure about your contract status or would like a free energy review, Club Assure is here to help.
