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What is the average cost of small business electricity?
If you run a small business, it's important to manage your outgoings. Reducing your energy bills can be an easy way to make sizeable savings.
If you haven’t switched energy provider for a few years, you could be overpaying on your energy bills by hundreds of pounds a year. Fortunately, comparing small business electricity prices is easy. You can find out how much you could save in minutes.
Here at Business Electricity Prices, we’ve built strong relationships with energy suppliers. This allows us to ensure small businesses have access easy access to great electricity tariffs.
The latest average rates are 16.74p per kWh for micro businesses and 14.83p per kWh for small businesses.
Here, you can find a breakdown of the average electricity costs by business size:
|Business Size||Usage/ Year||Unit Price/ kWh||Standing Charge||Cost per Year|
|Micro Business||8,000 kWh||16.74p||27.40p||£1,439|
|Small Business||20,000 kWh||14.83p||26.83p||£3,064|
|Medium Business||40,000 kWh||13.68p||26.41p||£5,568|
These average costs will by no means be the cheapest available. You should compare prices to ensure you are on the best deal for your business.
What Is A Micro-Business?
A micro-business is defined by the EU as having less than ten employees or a turnover less than £1.8 million. This definition would cover most of the 4.4 million businesses operating in the UK.
Ofgem made changes in the contract terms that energy suppliers provide for these companies. The renewal and switching of contracts are now much clearer for micro businesses. The energy company contracted must let you when your contract is up for renewal.
Before this change, it could be difficult to find out when your renewal was due. Dates for switching or negotiating a new contract may have been hidden in lengthy terms and conditions. The contract would renew automatically for another year under more expensive terms. The change made is for new contracts and is not retrospective.
What Types of Micro Business Tariffs are Available?
The small business electricity market is incredibly competitive. So, you have access to a range of pricing options to keep your costs low. Most energy contracts will last for one, two, or three years.
When comparing business electricity, you can choose from the following tariff types:
Fixed Rate Tariff
With a fixed rate tariff, the unit price of your electricity remains the same throughout your contract. This option is great for businesses who prefer certainty. It can make your energy bills easier to manage.
Variable Rate Tariff
Under a variable rate tariff, your unit rates can change during the duration of your contract. This means you will benefit from any drop in your supplier’s unit rate. However, if the unit rate goes up, your electricity prices will also increase.
No Standing Charge Tariff
A standing charge is a fixed daily cost paid to your supplier no matter how much electricity you use. As the name suggests, with a no standing charge tariff, you will not pay this fee. This can mean that your unit rate is higher than other standard tariffs.
Green Energy Tariff
If your business is looking to be more eco-friendly, you can choose a green energy tariff. Your electricity will come from renewable sources. This allows your business to limit its impact on the environment.
How to find the cheapest small business electricity prices
Energy companies rely on inertia much like insurance companies. There is little reward for customer loyalty. New customers often receive the best prices in the business energy market.
Business who fail to switch or renegotiate before the end of their contract will be placed on a rollover contract. These are often some of the most expensive rates offered by suppliers. They can have a serious impact on the cost of your electricity bills.
The main options available for small businesses are:
- Renew with your current provider (often at much higher rates)
- Compare more than 50 electricity suppliers yourself to find the best deal
- Use an energy comparison expert to find electricity prices
The first two require your own time and effort. You may miss out on some deals depending on the service you use. Only contacting your current provider means missing out on a large part of the market.
By comparing with Business Electricity Prices, you will have instant access to great tariff prices. You can compare energy suppliers from the 'big six' to smaller independent providers.
Additional Discounts and Savings Tips
Further savings can be made by paying your bills by monthly direct debit. Normally, quotes include this discount. So, if you select to pay manually, an additional 2%-5% will be added to your invoice.
A dual fuel tariff could incur a small reduction. However, you should get separate fuel quotes and calculate the totals for each.
Choosing the right tariff for you small or micro business
When comparing energy suppliers with Business Electricity Prices, all you need to provide is your business address and your contact details.
It can be difficult to decide how long to commit to a contract for. Our advice is probably to go for a one-year contract length. However, most providers can offer up to three-year contracts with fixed pricing.
A Climate Change Levy, or CCL, is payable by all companies in the UK. The tax is added by your supplier to your bill before VAT. The higher your electricity usage, the more your CCL rates will be.
Why switch with Business Electricity Prices?
We aim to make the process of switching business energy suppliers as simple as possible.
When you switch energy supplier with us, you will be provided with a dedicated account manager. They will handle the process of moving you to your new supplier, allowing you to get back to running your business.
Our services don't just end when you move to your new contract. We'll be in touch with you towards the end of your deal to keep you on right tariff. With Business Electricity Prices, you'll never be left overpaying for your energy bills again.
Small & Micro-Business Electricity FAQs
Do I need to move to a new supplier to get a better deal?
When comparing small business electricity prices with us, you are likely to find a better deal from your current supplier than the one in your renewal letter.
You are under no obligation to change your supplier. Many businesses have made savings by switching to a new deal with their current supplier through our comparison service.
Will my business energy supply be affected when switching?
As with residential switches, your electricity supply will not be affected when you switch energy supplier.
You can arrange for your new contract to start as soon as your current contract expires. You will continue to receive your electricity supply as normal.
What affects the cost of my business electricity?
Several factors can affect the cost of your business electricity. These include:
- The size of your business
- The location of your business
- Your business type
- Your energy consumption levels
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