The service, which receives more than 30,000 calls from small businesses every year, is to be taken over by Consumer Direct. However, the Federation of Small Businesses (FSB) says Consumer Direct "has shown little willingness or ability to tackle small business energy issues".
A FSB poll of more than 1,000 business owners revealed that 57% had made complaints to their energy companies and that only half of those complaints are being dealt with satisfactorily.
FSB environment and energy chairman John Holbrow said: "It is sad to see the government disbanding Energywatch at the very time when its work on behalf of small business consumers is most needed. The government has so far failed to ensure that there is an effective alternative."