Finding a business electricity supplier requires a bit of research. You’ll want the right combination of price, customer service, reliability and fair contract terms. If sustainability is one of your business goals, you may also want to factor in how renewable the energy is, so you can reduce your carbon footprint.
Whether it’s the cheapest possible power, the most flexible contract terms, or a 100% green option, our goal is to make choosing business energy as simple as possible for you.
We research every UK provider so you don’t have to, and we offer a simple comparison service that helps you choose the best electricity provider for your business.
Business Electricity Rates, Prices And Tariffs
Typically, business energy suppliers assess what type of business you are, what type of meter you have, and your likely energy consumption before offering a quote. This means it can be tricky to compare deals between
different suppliers because the price you are offered will be ‘bespoke’ to your business and its energy needs.
You’ll pay two costs as part of your total energy bill:
· price per unit of electricity (measured in kWh)
· standing charge (a daily charge which covers the cost of transporting the energy to your business premises)
As of August 2024, an approximate average price for business electricity would be 23p-25p per kWh, plus a daily standing charge of between 74p and 95p. These prices are based on a two-year contract.
There is no price cap on business energy rates, and there are no longer any government schemes running to help reduce your company’s energy bills. This means it’s vital to do your own due diligence to secure a good deal.
While value for money is important, getting the lowest price for business energy might not be your main or only priority. You’ll want to select the energy supplier that offers the right balance of cost and customer service, without tying you into an excessively long contract. Energy supply is a crucial element of your company’s success, so take a little time to think it through. We’re here to help.
What Types Of Business Energy Tariffs Are Available?
Fixed-rate tariff – This is where you pay a fixed cost per unit of energy for a set period of time, typically one to four years. Your actual bill will still vary depending on your energy usage, but the price per unit does not change.
Deemed Rate Tariff – You’ll usually be automatically put onto a deemed tariff if you don’t have a contract in place with an energy supplier. These 28-day rolling contracts are more expensive than fixed-rate deals but might work for customers changing to different suppliers regularly, who have recently moved premises, or who don’t want to be locked into a fixed-term contract.
Rollover Contract – If you’re on a fixed deal but don’t renew or cancel before your existing term expires, you might be moved onto a rollover contract. This means you stay on your existing contract with the same terms and conditions for 12 months. Rollover contracts are not usually good value for money, as you could be tied into a contract at a less-than-competitive rate. In fact, energy suppliers in the UK are no longer allowed to lock micro businesses into these poor value contracts.
Why Should I Switch Business Electricity Suppliers?
Your electricity bill could be one of your business’s largest utility costs, so choosing a supplier that will save you money is vital in an environment of high and rising costs. Switching your business electricity supplier could help you keep your business spending to a minimum by taking the most competitive deal available. You might also consider switching if you’re unhappy with the customer service you’ve received from your current supplier or if you want a greener energy deal which could help your business meet its sustainability goals.
How Does Electricity Switching Work For Business Customers?
Suppliers now go to tremendous lengths to facilitate businesses switching to their service, so the process is generally straightforward.
Assuming you’re not in debt to the supplier, or tied into a contract, you can switch at any time assuming you’re in the switching window.
The switching window will be specified in your contract, it’s usually between one and six months before the end date of your contract. If you’re in the switching window, you’re a perfect candidate for our business electricity comparison service, which will help find the right provider for you.
What Is The Average Business Energy Consumption?
Most businesses we deal with are small businesses that typically use between 15,000 and 25,000 kWh per year in electricity and 10,000 to 25,000 kWh in gas. Medium-sized firms might use 30,000 to 50,000 kwH of gas and electricity, and large businesses 100,000 khW or more. This could be higher depending on the industry or sector in which a company operates. If you want to find out your own consumption, simply check your most recent energy bill.
What Are The Average Business Energy Bills?
The average UK business now spends £5,160 on its energy each year and consumes 23 MwH (23,000 KwH) over that period. The average contract length is 25 months.
According to the Department for Energy, a small business paid 32.10p per kWh for electricity last year on average, and 6.06p for gas.
What Information Do You Need When Switching Your Business Energy?
Switching your business energy supplier is easy. Simply follow these steps:
- Find your most recent energy bill
- Ensure you’ve paid your account balance in full
- Make sure you’re within your contract’s switching window
- Use the free broker service on Business Expert to compare and secure the best deal
- Select and apply for the best tariff for your business
- Let your current supplier know you’ll be leaving them
- Wait for the changes to take effect and start making savings
How Much Can You Save By Switching Business Electricity?
The UK energy sector is a competitive marketplace, and prices vary widely. By switching to a more competitive tariff, businesses can save as much as 45% on their energy bills.
How Long Does It Take To Switch Business Electricity Suppliers?
Assuming you’re out of contract and ready to go, it can take just a few days to switch suppliers. If you choose a new supplier that’s signed up to Ofgem’s ‘Energy Switch Guarantee’, the switch should be completed within five working days. If it isn’t, you will be entitled to £30 compensation.
Who Is The Best Business Electricity Supplier?
We are asked this question almost daily, and of course, there’s no ‘one size fits all’ in such a diverse and complex market. For smaller businesses, there are certainly some companies that offer a tempting balance of well-priced tariffs, good customer service and attractive terms and conditions. We hope our research will help you sift through suppliers to find the right deal for your business.
How Is A Business’s Energy Rate Calculated?
Energy companies will look at a few different factors relating to your business to generate a quote for you. These will usually include:
- business location
- size of premises
- type of meter
- average monthly spend
- desired contract length
- distance from the power station to your business
- whether the Climate Change Levy applies (this is a tax designed to make UK businesses more sustainable)
What Factors Affect The National Price Of Business Energy?
It’s helpful to understand the factors that can affect your company’s energy costs, especially if your energy spend is a significant expense for your business. Here are some of the things that can influence your energy bills:
- Your energy consumption – not just the amount you use but the time of day you typically use it. Larger businesses with high energy use might be able to secure a lower overall rate. Businesses that use more energy at off-peak times may end up paying less.
- Supply and demand – energy prices fluctuate depending on whether consumer demand outstrips supply or vice versa.
- Global events – geopolitical issues can impact the supply and distribution of energy.
- Exchange rates – oil and gas are priced in dollars, so these commodities become cheaper when the dollar depreciates relative to other currencies.
- Climate – fuel prices generally fall in good weather because demand is lower
- Carbon pricing – as the climate crisis unfolds, the cost of carbon, as regulated by governments, will have a major impact on energy pricing.
What Are Some Ways I Can Reduce The Cost Of Energy For My Business?
- Make sure you’re on the most competitive tariff available that meets your business’s needs. If you can’t yet switch to a better deal, set a reminder to shop around as soon as you’re in your switching window.
- Educate your employees about energy-efficient habits. For instance, turn off lights and heating when not needed, and turn computers off rather than putting them to sleep.
- Most businesses could benefit from upgrading to the latest technology. Sensor-activated lights, thermostats, and energy-efficient lightbulbs are common places to start.
- Consider an energy audit to get a comprehensive picture of what you’re using where, and how you could reduce your energy consumption.
What About Large Business Electricity Plans?
Large businesses consuming more than 50,000 kWh in electricity or 65,000 kWh in gas per year will qualify for a specific range of energy plans. Energy companies will also insist on half-hourly meters, which send consumption data to the supplier every 30 minutes, or a multi-site meter if you have many premises.
Here at Business Expert, we offer a free and bespoke service to help larger businesses find the best energy supplier for their needs. Talk to one of our experts, and we’ll walk you through the pros and cons of the various choices, get to know your consumption habits and outline the tariffs that may be appropriate. For larger companies, the onus is usually on the suppliers to bid for your business and offer specifically tailored quotes based on your business requirements.
Should You Get A Half-Hourly Electricity Meter?
The latest meters use Automatic Metering Technology (AMR) on a fixed line to provide accurate electricity readings for up to half an hour.
For businesses with significant energy consumption, these meters can be a prudent measure. They can show you how much energy you’re using throughout the day, helping you make cost savings and budget.
By law, you must have a half-hourly meter if you use more than 100kWh in a 30-minute period.
To find out whether a new premises has an HH meter installed, looking at a previous bill will give you a clue. Commercial electricity bills contain an S number. If the number in the top left is ‘00’, there is an HH meter installed at the property. If you are unsure, contact your supplier for confirmation.
What Are Some Of The Best Electricity Deals Available Now?
It’s tricky to give a breakdown of the best deals available because the price you get will depend on the information you give a supplier about your business and your normal energy usage.
To give you an idea, let’s use the example of a typical micro business and how much it would pay for energy through British Gas. You’re considered a micro business if:
- You use less than 100,000 kWh of electricity a year OR
- You use less than 293,000 kWh of gas a year OR
- You have fewer than 10 employees (or their full-time equivalent) and your yearly turnover or yearly balance sheet, is less than two million euros.
British Gas would charge a micro business that is:
- A new customer
- In a one-year contract
- Using 21,000 kWh of electricity a year
no more than 186.60p per day standing charge and 28.57p per kWh.
This works out to £6,681 over the year.
