Let’s be honest—most small business owners don’t have time to sift through energy tariffs or negotiate new rates every six months. So when an energy broker offers to “handle it all” and “get you the best deal,” it sounds like a lifesaver.
But here’s the rub: energy brokers aren’t always working for you.
Some are paid by the retailers they recommend. Others lock you into long contracts that benefit them more than your bottom line. And in the fine print? Well, let’s just say it rarely makes for light bedtime reading.
So before you shake hands with another broker promising savings, here’s what you really need to know.
What is an energy broker, and how do they actually work?
At face value, an energy broker is a middleperson. They compare offers from electricity and gas providers and help you switch to a supposedly better plan.
Sounds helpful, right?
Well, it depends on who’s paying them. Many brokers receive commission from the energy retailers they “recommend.” The more customers they steer to that provider—and the longer you stay on that plan—the more they earn.
So while you might get a marginally better rate, there’s often a conflict of interest baked in.
Do brokers really save you money?
Sometimes. But not always.
Let’s say you own a retail store in Melbourne. Your broker tells you they’ve found a “great rate” and recommends locking it in for three years. But behind the scenes, they’re earning an upfront commission on that contract—and you’re stuck with it even if better options emerge next year.
In some cases, small businesses end up on tariffs with higher usage charges, inflated daily supply fees, or sneaky late payment penalties. All because the deal was broker-friendly, not business-friendly.
Why is this a problem for small retailers?
Because every dollar counts.
If you’re trying to reduce retail store energy bills, trusting someone who may not be 100% aligned with your goals can be risky. Retail businesses, especially independents or franchises, typically operate on tight margins. A few cents per kilowatt-hour here and there? It adds up.
And unlike large corporations, most small stores don’t have in-house energy managers or time to constantly re-evaluate their contracts. You’re relying on the broker to act in good faith—but the system doesn’t always reward that.
Are all brokers bad? Or just some?
Let’s be fair—not all brokers are dodgy. Some do offer genuine advice and work transparently. The key is knowing how they get paid, and whether their incentive aligns with yours.
Here are a few red flags to watch for:
- Lack of transparency: If a broker can’t clearly explain how they’re compensated, proceed with caution.
- High-pressure tactics: Be wary of “limited time” offers that force rushed decisions.
- Locked-in contracts: If there’s no flexibility or exit clause, think twice.
- No ongoing service: A good broker should help you re-evaluate every year—not disappear after the contract’s signed.
Cialdini’s principle of authority comes into play here—people tend to trust professionals who “sound like they know what they’re doing.” But authority doesn’t always mean alignment.
Is there a better alternative to traditional energy brokers?
Yes. Tech-driven energy procurement platforms are quickly disrupting this space—and for good reason.
These platforms don’t rely on commissions. Instead, they automate comparisons across dozens of retailers, using your actual usage data to calculate savings and forecast costs. Some even re-tender your contract before it expires—without you lifting a finger.
Better yet, they focus on transparency and automation rather than persuasion and commissions. That means you get better visibility, fewer surprises, and often, a healthier bottom line.
A real-world example: The hidden cost of trusting the wrong broker
Earlier this year, a regional café chain discovered they were paying 23% more than necessary on their energy bills. Why? Their broker had recommended a provider that offered the highest commission, not the lowest rate.
Once they moved to an automated procurement model and began monitoring their usage more closely, they reduced their annual costs by nearly $9,000—enough to hire a new casual employee during peak summer months.
It’s a familiar story for many Aussie businesses who realise—too late—that convenience came at a cost.
FAQ: Energy Brokers and Small Biz Energy Costs
Q: Are energy brokers regulated in Australia?
A: There’s limited regulation. While brokers must comply with the Australian Consumer Law, there’s no formal licensing system or fee transparency requirement.
Q: Can I ask my broker how they’re paid?
A: Absolutely. In fact, you should. Ethical brokers will be upfront about commission structures.
Q: What if I already signed a broker-negotiated contract?
A: Review the contract’s terms—especially the exit clause. Some tech platforms can audit your plan and flag if there’s a smarter move once your term ends.
Final thoughts: Trust should be earned, not assumed
There’s nothing wrong with asking for help. But in energy procurement—just like any other service—who you trust matters.
If someone benefits more from locking you in than helping you save, that’s not a partnership. That’s a transaction.
And in business, especially retail, you want every partnership to move you forward, not tie you down.
As more Australian retailers look for smarter ways to reduce retail store energy bills, it’s worth asking one simple question: Who does this actually benefit?
If the answer isn’t “you,” it’s time to explore better options.