FAQs about the Letter of Authority (LoA)
What is a Letter of Authority and why does the Energy Action Group require it?
An LOA is the instrument that provides the EAG with the authority to obtain essential energy supply data from your supplier. It is a requirement under Data Protection laws and without it, your current energy supplier will not provide essential data to us. This means we will be unable to carry out a range of necessary tasks on your behalf, including submitting tenders, installing or removing meters, asset transfers, changes of tenancy, dealing with billing errors and gathering consumption data for energy management purposes. In brief, it provides all the necessary authority that permits the EAG to deliver its services.
The EAG takes its role very seriously and we are conscious that we perform our services on behalf of the not-for-profit sector. We appreciate the fact that this sector delivers valuable, and often vital services to the broader community and that every penny saved is crucial.
We have managed thousands of energy contracts on behalf of our members over the years and we are at pains to deliver our services in an ethical and principled manner.
You will find a list of important topics below that should help you understand how a Letter of Authority works.
LoA TEMPLATE
Your LOA enables the EAG to access relevant information from your current suppliers including contract end dates, consumption data and contract prices.
The EAG LoA takes the form of a template which you can download. This should be placed onto your own letterhead, signed, and returned to us, ideally on one single page.
Without an LOA, we will not be able to obtain your supply details. This means we won’t be able to provide you with exact pricing. Any broker who tells you otherwise is just guessing. If they offer you a contract based on anything other than absolutely accurate data, you could have a costly failed contract or delayed start date.
The LOA is a legal requirement, as your information is protected under the Data Protection Act. As such, your supplier is not able to disclose this information without your express permission.
No Company Letterhead?
What if your organisation doesn't have a letterhead?
Download the LoA and fill in all the empty spaces whilst on your computer by using Adobe Acrobat. Once completed, copy the completed template onto plain paper and add the details of your organisations to the top section. You can also add a company stamp if you have one
How long is the EAG LoA valid for?
Energy suppliers generally permit an LoA to be valid for up to 3 years, and as a rule, the EAG seeks validity for the full 3 years. This saves time and allows us to monitor routine energy issues on your behalf without needing to continually contact you, but in the event of important issues, we will always liaise with you.
As and when the LoA is expiring we will contact you for a new one.
What utility supplies does the LoA cover?
The Letter of Authority relates to both gas and electricity supplies and recently, water. It is not restricted to any specific energy or water supplier, and if you have contracts with several suppliers, it will cover them all.
CAUTION. Do NOT sign a Letter of Authority if you do not know who you are speaking to.
Some dishonest brokers have designed LOAs in such a way as to allow them to sign legally binding contracts on your behalf, and without your knowledge.
Exclusive Letter of Authority
Be warned! It is disturbing, the length to which some energy brokers go to disguise the real meaning of some of the terms and conditions in their LoAs.
Be careful, some LoAs contain language that is disguised so that in effect, by signing, you are nominating the Broker as your exclusive representative when negotiating energy contracts. Do not agree to this. You won’t get best market rates. If a broker feels it is necessary to do this, he is not likely to be competitive.
If somehow you have signed an exclusive LoA, this means that we will not be able to provide competitive contracts for you for the period of the LoAs validity. Unfortunately, this implies that you will end up paying higher prices than you need to.
Some brokers will tell you that they need exclusivity in order to obtain the best prices for you. This is simply not true. If an Energy Broker requests exclusivity, you should be very cautious as to their real motives.
Exclusive Letter of Authority
Even worse that an exclusive LoA is one that grants the broker authority to enter into an energy contract on your behalf. PLEASE READ THE FINE PRINT.
You should never allow anyone other than a designated employee within your organisation to sign any energy contracts on your behalf. You wouldn’t do so when making capital purchases, so why would you do so with an energy contract, which could cost a lot more?
NEVER SIGN an LOA that is “exclusive”. DO NOT SIGN an LOA that allows your energy broker to “enter into contracts on your behalf”.
If in doubt, contact the EAG and we will review any LoA for you.
What is the relevance of my contract renewal dates?
There can be wide variations in prices dependant on your renewal dates. Contracts renewing in one month will not be the same as one starting in 6 months’ time. This is due to market conditions, temperature variations and geopolitical events. All of these will have an impact on pricing.
Unless suppliers know when your existing agreement ends, they won’t be able to provide prices for you.
Why do you need to know the annual consumption of the gas and electricity I use?
As with most products and services, prices reduce according to the size of the purchase. The larger the supply, the lower the prices will be. This is one of the benefits of joining the EAG Energy Basket as your consumption is aggregated with many other Members.
Download the EAG Letter of Authority here.
If you have any other questions about the Letter of Authority, please contact us.
