Many firms unknowingly enter power contracts with disadvantageous terms, resulting in greater prices and restricted flexibility. If you’re concerned about your company’s power prices, checking your contract and looking for ways to save money is critical. Understanding company energy expenses and selecting the best power supplier might help you get a better bargain. If unsure where to begin, use a Business Energy Comparison tool to examine various suppliers and programs.
Common Pitfalls in Commercial Electricity Contracts
- Deemed Rates and Out-of-Contract Tariffs
If your business electricity supply is based on considered rates, you pay far more than necessary. These default tariffs apply when no formal contract exists, and they are often higher than negotiated rates.
- Fixed Rate Contracts That No Longer Suit You
A fixed-rate contract guarantees business power pricing for a specific period. While this might provide consistency, it can also result in missing out on potentially considerable savings if wholesale prices fall.
- Hidden Costs and High Standing Charges
Some company energy suppliers incorporate large standing costs in their contracts. These are daily fixed fees for keeping your connection operational, regardless of power use.
- Not Reviewing Your Current Contract
Many organisations allow contracts to roll over without exploring alternative contract choices. Before entering into a new contract, always double-check the renewal terms and compare energy rates.
How to Save on Business Energy Bills
| Tip | Benefit |
| Switch Suppliers | Get a cheaper rate and avoid high renewal prices. |
| Use a Smart Meter | Monitor energy consumption and reduce waste. |
| Install LED Bulbs | Lower electricity bill with energy-efficient lighting. |
| Consider Solar Panels | Use renewable electricity to reduce long-term costs. |
| Negotiate with Your Current Supplier | Ask for a better deal before renewing. |
Energy Efficiency Measures Can Help Lower Energy Costs
Most firms can lower their energy expenses with easy changes:
Install a smart meter: Install a smart meter to track and manage power usage in real-time.
Optimise heating systems: Optimise heating systems by insulating your hot water cylinder.
Use energy-saving equipment: Upgrade to LED lighting and contemporary equipment.
Encourage staff to save energy: Encourage employees to preserve energy by turning off lights and machines when not in use.
Examine green tariffs: Encourage using renewable energy while minimising environmental damage.
Understanding Business Electricity Pricing
Electricity rates fluctuate based on numerous variables.
Unit Rate: The electricity consumption cost per kilowatt hour (kWh).
Standing Charge: A standing charge is a daily fee for keeping your power supply.
VAT Rate: Most firms pay 20%, although some qualify for a lower rate.
Peak Times: Using power during off-peak hours will help you save money.
Wholesale Prices: Market changes affect how much providers charge.
How to Secure the Best Business Electricity Deal
- Compare Electricity Suppliers for Businesses
Check prices from many electrical suppliers to obtain the best deal for your business. Look for adaptability, renewable energy alternatives, and possible savings.
- Check Your Current Supplier’s Terms
Check your existing business electricity contract before making a transfer. You may need to provide notice or pay departure costs. A pricing comparison might help determine if remaining or switching would save you more money.
- Look for Green Energy Tariffs
If your company is concerned about sustainability, green tariffs should be considered. These assist to reduce environmental impact by supporting renewable energy sources such as wind and solar.
- Understand Half Hourly Metering
Large enterprises may have a half-hourly meter that records precise electricity use statistics. This aids in maximising consumption and securing a better price.
- Negotiate Your Contract Terms
Negotiating with your provider might result in lower business power rates. If you’re relocating, look into the contracts available in your new location.
When to Change Business Electricity Suppliers
New business locations and contract renewals are good opportunities to change suppliers. If your present provider isn’t providing a better deal, looking elsewhere might result in big cost savings.
FAQs
- How can I know whether I overpay for my company’s electricity?
Check your unit rate and standing fee and compare them to market electricity costs. If you’re paying considered rates or have an expired contract, you’re probably paying too much.
- Can I change my business power provider at any time?
This is subject to your existing contract conditions. Some firms may suffer exit costs, although many can move providers after their contract without penalty.
- What is a smart meter, and how might it benefit you?
A smart meter measures your power use in real time, allowing you to discover methods of conserving energy and money.
- Are there any government incentives to use renewable energy?
Yes, certain firms may be eligible for FIT payments (Feed-in Tariffs) or other incentives if they use solar panels or other renewable energy.
- What should I think about before signing a new contract?
Examine the unit pricing, standing charge, contract term, and any extra costs. Check if the provider provides green tariffs or flexible pricing.
Final Thoughts
To correctly manage company electricity, you must first analyse your power contracts, understand your energy use, and ensure you are not overpaying. Whether you manage a small or large business, adopting proactive efforts might result in possible savings on your business electricity bills.
