Small business electricity prices

Office Manager, north London, Client since 2019

Operations Director, Client since 2011

Prices from more than 20 energy companies

Most energy companies in the commercial sector do not have a licence to supply to the domestic energy market.

The exceptions are a few of the larger suppliers (British Gas, EDF, Scottish Power, etc) who supply both commercial and domestic markets. You will certainly be familiar with these suppliers, but which suppliers are you missing out on? And more importantly, which can  you trust?

Business electricity contracts come with a myriad of terms and conditions. For example, under certain circumstances, a fixed price contract with several suppliers, may not actually be completely fixed. It’s all in the small print. We advise wherever possible.

Our knowledge of the energy market and price movements

The majority of small business owners will be preoccupied with running their business. Energy companies will write to businesses near the end of their energy contract with a renewal price. It is usually only then, that a business owner may look at options for their next electricity contract.

Or they may miss this letter altogether and end up on out of contract rates (examples above).

This is where our market knowledge is invaluable to business owners.

For a start, we will be in touch in plenty of time to ensure a new contract is in place when your old contract expires.

Business electricity prices are constantly changing. Prices are affected by global events. This means prices can fall for a short period before bouncing back. Or work their way up gradually over a longer period of time.

We try to contact our business energy customers when prices are looking good. Not every business owner will want to commit this far ahead of course. But they know we are thinking about them and working hard to reduce the energy costs for their business.

Supporting your small business during your contract

Ever had a problem with your energy bill and had to hold on the phone to your electricity supplier? Then you have to call them back because they didn’t correct the mistake. And you get through to a different call centre. And have to explain it all over again…

Or perhaps you are just unsure how the energy industry operates, and don’t know how to resolve something? It could be a problem with your bill or your meter.

You have a business to run.
We are the experts in all energy related problems.

Energy comparison sites and many brokers will very happily set you up on a contract. And that is probably the last you will hear from them.

Not us.

Just let us know of any questions by phone or email. And we will resolve the issue with your energy supplier. After all, we recommended them to you in the first place. Of course, we will update you along the way with our progress.

All part of the exemplary service we provide.

First time running a business premises? Common mistakes to avoid

Business owners often assume that small business electricity prices and contracts will be similar to their energy prices at home.

Not so. There are several important differences, and understanding these from the start will simply save you money.

Sort out that electricity contract. Soon.

At home, you might be on a standard variable rate, or a fixed term contract. We all know that the variable rate is more expensive, but often leave it, perhaps thinking the saving won’t amount to a great deal.

When it comes to your business energy contract, however, remain on a variable rate at your peril.

Variable electricity rates (also known as deemed rates) in the business sector can be very high indeed. Easily 50% more than the average fixed business electricity price from the same supplier.

Why should you pay 50% more for your small business electricity prices? Call our team of experts for advice and options from over 20 energy companies.

Where are all the dual fuel tariffs?

There aren’t any. You will be hard pushed to find any dual fuel tariffs in the business energy sector. Some suppliers do offer a discount for paying by Direct Debit though. We take this into account when we check electricity rates for your business.

Businesses clearly use a lot more electricity. And one supplier in such a large market, is unlikely to have the lowest price for both electricity and gas. Settling for an ‘ok’ price for one commodity instead of the best price, will cost you a lot more than a £30 dual fuel discount.

In addition, some business energy suppliers specialise and supply only electricity. Or just gas.

You can’t change your mind

There is no ‘cooling off’ period for business energy contracts. You should be completely comfortable, therefore, with the length of contract and the electricity prices you commit to. You won’t be able to change your mind at a later date.

You can’t leave your contract early

And following on from the above, you can’t leave your contract before it ends. There are no early termination fees for small business energy contracts. Again, please ensure you are entirely comfortable with the commitment you make.

The only exceptions to this are if you close the business, or move premises. In both instances you should take a meter reading on the last day, and call your energy supplier with the information and your forwarding address.

Don’t renew your energy contract at the last minute.

You should allow a minimum of 2-3 weeks for a new supplier to register your electricity supply. They need to follow processes put in place by Ofgem.

Another major benefit of asking us to help – suppliers allow us to confirm prices up to 12 months ahead of the start date. This is clearly too far ahead for many people, the majority of our clients prefer we contact them 5-6 months before their contracts end.

However, we can be responsive to falls in the price of business electricity. Leaving it to the last minute makes this more unlikely.

You need to log a termination notice 30 days before the end of your contract

That is, if you would like to change supplier. We do this as part of our service when arranging your business energy contract. If you were to wait until the end of your contract, then you will have 30 days on the variable rate from your energy supplier.

As noted at the top of this page, this can be around 50% higher.

Business electricity prices – common questions

How long should I fix electricity prices for?

A fixed price electricity contract of 2 or 3 years will usually be more expensive than a one-year contract. However, you will be guarding against any price increases during the contract period. At a time when electricity prices are volatile this can be a sensible option.

You can also fix your small business electricity prices for 4 or even 5 years. We generally don’t recommend committing for this long though. Unless you have a very small electricity supply.

Ideally you don’t want to over commit yourself. Business electricity prices do fall occasionally. The longer you fix your energy prices for, the less chance you have of taking advantage of the next price fall.

How can I compare small business electricity prices?

We are an independent energy broker, so have access to the latest prices from more than 20 energy companies. We keep energy suppliers keen, by holding them to their lower prices, rather than the inflated rates they may try to push through.

As mentioned above, we don’t just compare electricity prices for you. We are on hand throughout your contract should you need us for advice.

What are the benefits of using an energy broker?

Utilising the services of a professional energy broker, such as Perfect Clarity, can save your small business a considerable sum in electricity costs. Along with the continued support through your contract(s), it is a valuable service.

But please be warned, there are plenty of unscrupulous energy brokers who tarnish the industry. Don’t agree to anything from a cold call, and be sure to check prices elsewhere to confirm what a good rate is at the time.

Business electricity prices are changing frequently. We can confirm your next electricity contract anytime during the last 12 months of your current contract. This ability to be so responsive means our customers take advantage of falls in the price of business electricity.

And we are available throughout the length of your electricity contract to answer any questions you may have. This might be about a bill you have received, or you need the electricity meter changed.

There is no obligation whatsoever to use the electricity prices we send you. We earn a small fee which is included in the contract prices as per our Terms and Conditions. This covers our market knowledge and years of experience, as well as processing contracts and dealing with suppliers for you.

What information do I need to get business electricity prices?

All the relevant information is usually on your electricity invoice. You can either email this to us, or call us and we can go through the information we need. This includes:

• Your current supplier
• The MPAN or Supply number (serial number on the meter will also be ok)
• A rough indication of how much electricity your business uses in kWh
• The date your current contract ends

Then we can check our business electricity prices from the 20 suppliers we work with. And send our best options to you within 24 hours wherever possible.

How much is business electricity per kWh?

A typical price for business electricity per kWh is 12p – 15p per kWh. This is a guide. Business electricity prices vary due to a number of different factors. You can see our recent business electricity prices at the top of this page.

The electricity region where your business is located in the UK, is one such factor. Within each electricity region, every energy company will have their own price for electricity.

These prices will vary depending when they purchased their electricity. And how much it cost them, how much electricity your business uses each year, and other factors.

The price energy companies charge your business for electricity consists of the wholesale price of electricity, charges from the Grid for using their cables and connecting your business to the electricity network. There are also government taxes. And then operating costs and profit margin from the energy company themselves. And don’t forget to add VAT (and CCL if applicable).

Read more about the costs that make up your business electricity prices.

How much power does a small business use?

The average power use of a small business is around 30,000 kWh per year of electricity. This will clearly vary considerably from business to business.

A small shop may use 10,000 kWh per year. A restaurant 70,000 kWh, and a larger user such as a club or manufacturer could be 200,000 – 300,000 kWh.

At Perfect Clarity we work with businesses in all sectors with a range of energy use. We will always have plenty of energy suppliers for you to choose from.

Are business electricity prices going up?

As a rule, business electricity prices will go up over time. However, global events will affect prices and there can be some sizeable falls in the price of business electricity.

Energy prices are a little like the stock market in this respect. The graph increases over time, but there are lots of ups and downs along the way.

How to reduce business electricity costs

There are two ways to reduce your business electricity costs. And doing both will help you make inroads into reducing your business electricity bill:

1 Reduce the electricity used by your business.
2 Reduce the price you pay for electricity.

Reduce electricity consumption at your premises

How you do this will depend on your type of business. In general, lighting can account for a substantial chunk of your business energy use. And therefore, your bill. If you have a commercial kitchen that uses a electricity rather than gas, this is another area to look at.

Ensure lights are turned off when not in use, as well as other equipment if practical to do so. Get your staff on board with this and you should notice an overall drop in consumption.

We have several guides to reduce energy consumption for different businesses:

– For businesses with refrigeration units

– Energy use in a commercial kitchen

– Reduce your pub electricity bill

– And some tips for hotels to reduce energy costs

Reduce the price you pay for business electricity

Getting the best price for electricity at your office, shop, café or pub, will undoubtedly help reduce costs.

Call our team on 020 3372 6517 for the latest prices from a range of energy companies. We work with over twenty energy providers and can advise on the best energy contract for your business.

How to change business electricity supplier

First of all, you need to know when your business electricity contract ends. You shouldn’t leave it to the last minute either, as it can take at least 2-3 weeks for a new electricity company to take on your business supply.

If you have asked us to arrange your next electricity contract, then we will look after the whole change of supplier process for you.

However, if you are going it alone, here are some tips.

You should ensure that your current business electricity supplier knows you are leaving. You can do this by emailing them to the correct address in the terms and conditions of your contract. Make sure you quote your account number and the email is sent in by someone who is registered on the account with your energy company.

This is referred to as the ‘termination notice’. It doesn’t actually terminate your electricity contract there and then, it just gives your supplier the required 30 days’ notice. Then you can leave the day after the contract ends, providing the 30 days’ notice has elapsed.

Then make sure you arrange a contract in advance with a new energy company. If you are more familiar with domestic energy, you may not be aware of the different energy companies in the business sector. A good energy broker like ourselves, who works with over 20 business energy providers, will be able to help.

Comparison sites will give you some guidance, but their prices are fairly standard and not the best. And they only work with a handful of suppliers.

For advice and better prices, call us on 020 3372 6517.

What is VAT on business electricity?

The vast majority of UK businesses will pay 20% VAT on their electricity bills. This is added to the cost of electricity, it is not included in the electricity prices you are quoted by energy companies.

Some smaller businesses and charities, who are low consumers of electricity, will only pay 5% VAT on their business electricity bills. You may find that your organisation pays 5% VAT on some bills, and 20% on others.

This is because any bills for electricity use under 1,000 kWh per month, are automatically billed at the reduced rate of VAT. This is classed as de-minimis use by HMRC. See Section 5.2 of HMRC Fuel and power VAT notice 701/19 

If your business or charity electricity use is around 12,000 kWh per year, you may find some months it is over 1,000 kWh. And some months, under this figure.

There are additional rules around VAT on energy for charities.

Which is the cheapest business electricity supplier?

This can change from one day (or week) to the next.

For one particular electricity region it might be EDF. And the following week it might be British Gas. Or Scottish Power, or another energy supplier.

For the same region, but a much larger electricity consumption, the cheapest supplier might be Total Gas & Power, or EON. Or a different set of results altogether.

There are so many variables when it comes to electricity pricing.

Energy companies buy their electricity at different times, and in different quantities. The price of electricity can be affected by global events (and go up or down quite quickly).

The cheapest business electricity supplier will also depend on your electricity use. Some suppliers are better priced for smaller volumes than larger sites. And vice versa.

And the best priced supplier for one electricity region, won’t necessarily be the best priced option in the region next door.

If we are talking green electricity, some energy suppliers generate all their own electricity. Others will purchase this from other electricity generators.

To find out our best electricity prices for your business, call us on 020 3372 6517.

Who supplies my business electricity?

You can call the regional Distribution Network Operator (DNO) for your electricity supply region. They should be able to trace your current electricity supplier.

Your DNO operates and maintains the section of the national electricity grid in your region. It will be useful to have the serial number of your electricity meter to hand.

If you don’t have time to chase this up, just drop us a line.

Who is the best business electricity supplier?

The best electricity supplier could mean “best price” or ‘best customer service”.

As we have covered above, business electricity prices change all the time and are subject to many different factors.

The best business electricity supplier in terms of customer service, is another angle. Energy companies do tend to receive bad press. They each have hundreds of thousands of customers (or millions), so most of their processes are automated. This means errors are often only spotted when a business customer receives a large bill.

Customer service could be measured in how long it takes a supplier to resolve the issue.

We deal with energy companies on a daily basis. In truth, they can all have an off day, and they can all make mistakes. It can depend if you get a very helpful member of staff on the end of the phone when you call. That is, if you don’t have to wait half an hour to get through.

When we need to call suppliers about customer contracts, we find EDF are quite responsive, as are Scottish Power. There are many others too.

If you have a question about a bill relating to an energy contract we arranged for you, just get in touch with us. We will get in touch with the supplier on your behalf and resolve the problem for you.

All part of the service. You can concentrate on running your business.

Why is business electricity so expensive?

If your business electricity is so expensive, you should check your electricity contract. You could be on a variable rate. Ask your energy supplier for a fixed price contract. This will reduce your electricity bill.

Or call our small team. We work with over 20 energy companies and will find the best electricity prices for your business.

Business electricity suppliers don’t often give small businesses the best prices. They reserve these for larger consuming companies.

However, we hold energy suppliers to account and endeavour to get your business better rates, on a par with a larger electricity user.