As a successful business owner, you’ll know that finding opportunities to cut costs is an essential part of running a profitable company. Meaningful savings can be made just by switching electricity plans, but it pays to know a bit more about business electricity, how your company uses it and how it can save it before beginning the process.
To arm you with all the information you need to secure substantial savings, we’ve put together the answers to a range of business electricity questions.
You may have been happy with your business’s electricity contract when you first signed it, but if you haven’t renegotiated it for a few years, it’s probably no longer competitive.
When your contract approaches expiry, you’ll get a renewal offer from your supplier. Understandably, many time-poor business managers accept this. Unfortunately, renewal agreements are rarely the best deals on the market.
If you don’t sign a renewal offer or move to a new deal when your contract expires, your supplier will transfer you to a higher priced deemed-rate or rolling contract. By switching to a fixed or variable-rate tariff, you’ll cut your bills considerably. And by changing supplier, you might get an even better deal.
The two main elements in your electricity bills are the unit cost and the standing charge. The unit cost is the price you pay for each kWh of electricity that your business uses. The standing charge is a daily amount that covers national grid maintenance and electricity transportation.
Since every business electricity contract is bespoke, there’s no clear-cut answer as to how much your rates should be. The figures below will give you a rough idea of average business rates:
Average business electricity rates
Please note: These figures are based on industry averages and are only intended as a guide. Many factors impact the amount you pay for your business electricity, including consumption habits and location.
|Business size||Unit cost||Standing charge (daily)|
|Micro business||13.3p per kWh||27p|
|Small business||12.4p per kWh||25p|
|Medium business||11.5p per kWh||22p|
A half hourly electric meter sends updated readings to the supplier every half hour. Since April 2017 it’s been mandatory for businesses with a maximum demand of 100kW or greater in any half hour period to use one. Businesses with a demand of 70kW or more can also opt to have a half hourly electric meter installed.
Half hour metering allows for extremely accurate and up-to-date bills without the bother of manually taking and submitting readings. These highly detailed readings make it easy to identify periods of high usage.
To get the best possible business electricity rates, run a quote comparison to see what’s on offer in the marketplace and then switch to the most competitive deal. For a full picture, compare quotes from at least 10 different suppliers. Be prepared to negotiate and ask a range of business electricity questions to understand the details of each deal.
Finding the right business electricity deal takes time, effort and knowledge. This is where a business electricity broker can help.
Business energy brokers are specialised intermediaries who work with both energy consumers and suppliers. A good broker will have both large and small suppliers on their books from which they’ll negotiate a selection of deals that best suit your business’s needs. They’ll use their expertise to answer a whole range of business electricity questions and advise on which tariff looks like the right fit.
Before you can switch, you’ll have to wait for your renewal window to come up. In the meantime, conduct an audit of your business’s electricity usage to see where it’s being used and wasted. Smaller businesses can use an energy saving power meter to do this. Avoid leaving equipment on standby for long periods by using a PC automatic standby shutdown extension lead to recognise idle computers and automatically shut off power. Using energy efficient bulbs and ensuring fittings are free of dust will reduce wastage through lighting.
You’ll see an improvement in your bills if you employ these measures, but it’s nothing in comparison to the amount you could save by switching electricity plans or suppliers.
With a little help from Make It Cheaper, you can concentrate on running your business without overpaying on electricity. We’ll find, negotiate and compare the best business energy deals for your company’s unique needs. Our commercial energy experts have the answers to a whole range of business electricity questions and once you’re happy with the details, we’ll handle all the paperwork involved in making the switch. To help you stay competitive, we’ll even get back in touch when your new contract comes close to expiry.
To start saving on your business electricity bills, call Make It Cheaper today on 0800 970 0077. Or, if you’d prefer, leave your details in the form at the top of the page and we’ll call you back.