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Small business energy

Keeping costs low is an important exercise for any company. But when it comes to small businesses, this task becomes imperative. Tight margins mean that owners need to stay on their toes to keep overheads as low as possible. Failing to do so can be nothing short of ruinous.

Energy is an essential part of every business but paying for it can be quite a strain on SME business finances. This is why it’s vital to make sure that you’re getting the best electricity rates for small business and the best gas prices for small business.

Do you qualify for small business energy rates?

Large businesses with a maximum energy demand of 100 kVA or more per half hour use half-hourly meter tariffs. These affect the price of their energy as it gives them highly accurate and detailed bills. Microbusinesses can also get special energy rates. To qualify for a microbusiness energy contract, your company must use less than 200,000 kWh of gas or 55,000 kWh of electricity a year.

Small or Medium Enterprises (SMEs) are defined by the UK government and the European Union in the following way:

  • A Micro Business employs no more than 10 staff and has a turnover of under £2 million
  • A Small Business employs no more than 50 staff and has a turnover of under £10 million
  • A Medium Business employs no more than 250 staff and has a turnover of under £50 million

What if you run your business from home?

Many a SME business has begun life in the home of its founder. Domestic energy prices are more expensive than the relatively cheap electricity for small business and commercial gas. If you run your business from home, it’s worthwhile seeing if you can swap your household energy plan for commercial gas and cheap electricity for small business.

To get the best electricity rates for small business and the best gas prices for small business, you’ll have to meet certain criteria. To qualify for commercial gas and cheap electricity for small business, you’ll need to use 50% or so of your home energy to run your business. Using lighting, heating and electricity for your business can be enough to make you eligible, although you must deduct usage from any appliances that would be running regardless, such as your fridge.

What are the cheapest gas and electricity rates for small business?

Unlike household energy deals which offer premade tariffs online, business energy contracts are calculated on a bespoke basis to meet the exact needs of each company. This custom-built approach is good for SME business, but it makes it difficult to put an exact figure on what the best gas prices for small business and the best electricity rates for small business actually are.

Business energy suppliers take many things into account when determining commercial gas and small business electricity cost. Size, contract length and business type are all things that suppliers will consider with regards to commercial gas and small business electricity cost. Location can have a big impact on gas and electricity rates for small business with regional variations accounting for a whopping 20% difference in some cases. It’s easier to get cheap electricity for small business in cities than in rural areas.

While there’s no easy answer as to how much gas and electricity rates for small business should be, average prices can help to give an indication:

What are the best electricity rates for small business?

Business size Annual usage Price per kWh Standing charge Avg. annual cost
Micro business 5,000 - 15,000 14.4p - 15.9p 23p - 29p £900 - £2,244
Small business 15,000 - 25,000 14.3p - 15.1p 23p - 28p £2,367 - £3,660
Medium business 25,000 - 50,000 14.3p - 14.7p 23p - 27p £3,774 - £7,234

What are the best gas prices for small business?

Business size Annual usage Price per kWh Standing charge Avg. annual cost
Micro business 5,000 - 15,000 5p - 5.1p 19p - 25p £400 - £820
Small business 15,000 - 30,000 4.5p - 5p 19p - 25p £820 - £1458
Medium business 30,000 - 65,000 4.3p - 4.5p 24p - 25p £1458 - £2239

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 energy, including consumption habits and location.

How to compare small business energy rates

Because of the bespoke nature of business energy plans, you won’t find the best gas prices for small business and the best electricity rates for small business online. Instead, you must call suppliers individually to negotiate gas and small business electricity cost. This can take time, a luxury that most business owners simply don’t have.

This is where Make it Cheaper can help. We’ve assisted more than 250,000 customers to bring down their small business electricity cost and gas prices to date. With just a short phone call, our energy experts can determine your business's consumption habits. It can be helpful to have the following items to hand:

  • A recent energy bill
  • Your business's registration information
  • Your MPAN and MPRN numbers from your bill or meter
  • Your contract's expiry
  • The date your switching window opens

Our team of UK-based experts can then get to work gathering, negotiating and comparing the best gas and electricity rates for small business. We’ve got Big Six and independent suppliers on our books to provide you with a whole range of deals from across the market. We’re confident in our energy know-how and we’ll advise you on which energy deal is likely to work best for your needs.

When we find you a deal you love, we’ll handle the switch for you. We can even help you remain on the best gas and electricity rates for small business by getting in contact again when your new deal is due to expire.

Give Make It Cheaper a call on 0800 970 0077 to hear how we can help your SME business pay less for its energy. Alternatively, leave your details at the top of the page and we’ll call you back.