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A guide to business energy
Most businesses rely on energy to operate, and if their energy supply stopped it would likely have a huge impact on their ability to trade. This means that it's vital for business owners to stay on top of their business energy bills.
However, this doesn't simply involve paying the bills every time they come through the door - it also means ensuring you're on a fair deal by comparing business energy bills, which is the only way to avoid paying over the odds for your business gas and electricity. The good news is that by running a simple business energy comparison, it is possible to switch to a better deal and get the energy that your business needs at a fair price.
Below you can find information that outlines a number of areas of business energy that you should be aware of when looking to secure a better price for your business’s gas and electricity.
Business energy tariffs and contracts
The first thing to note about business energy is that, unlike the domestic market where customers have the option to pick from a range of standard energy tariffs, a business energy customer must approach each supplier individually to attain business energy quotes. This is because the energy habits of businesses vary significantly in comparison to the relative stability of households, which makes each business customer unique from a supplier's perspective.
To meet such a variety of needs, business energy suppliers will assess each business’s needs on a case-by-case basis, to offer a bespoke quote based upon their initial assessment.
Bespoke business energy contracts are able to offer a variety of different businesses the right energy solution to meet their consumption habits. However, it can make it more difficult to understand whether you’re being offered a competitive business energy deal.
Another difference between domestic and business energy tariffs are the stricter terms by which you are bound. It’s possible for domestic customers to switch their tariff at any point during their contract - although they may have to pay an early exit fee. Business energy customers, on the other hand, are bound to their contract and are unable to switch until they are within their renewal window, which is typically six months before the end of their current contract.
Why switch your business energy?
Switching is the best way to reduce the amount that you spend on business energy. Just like on the domestic energy market there are a number of suppliers available for you to pick from. However, it’s worth noting that not all suppliers will be able to offer you a business energy quote.
The number of suppliers available to quote your business will depend on a number of factors, including:
- How much business energy you consume within a year
- Your business’s credit rating
When choosing between the suppliers available to you, it’s important to prioritise your business’s needs and not just a cheap business energy prices. Of course cheap business energy deals will always be attractive to a savvy business owner, but you need to ensure that the supplier is offering the level of service that your business requires.
To do this, it can help for you to be aware of the differences between suppliers before switching business energy deals to ensure that you’re getting a contract that best suits your needs. For example, a supplier such as Dual Energy focuses on, and has expertise in, the small business energy market. This makes them a more attractive supplier to smaller business owners in comparison to the Big Six, who can serve all businesses equally, regardless of size.
If you fail to switch business energy contracts, then there’s a good chance that your supplier will transfer you onto out of contract rates. Also known as ‘deemed rates’, these are prices imposed by suppliers when a customer’s contract expires, and a new one is not formally agreed.
Typically, out of contract rates one of the most expensive offered by a supplier, so it’s within your best interests to switch your business energy contract as often as possible to avoid paying these inflated rates.
Fortunately, business energy customers who are on out of contract rates are able to switch with only 30-days’ notice to a better deal.
Once you properly understand what a good deal looks like for your business, it’s time for you to compare business energy prices for business and switch.
Remember, you can contact uSwitchforbusiness.com and we can help you to understand you business’s energy requirements after a short conversation about your business’s needs.
How to compare business energy prices
Once you understand what you require from a business energy supplier, you’re in a position to start collecting quotes to begin your own business energy comparisons.
First of all, it’s worth noting that due to rules in place within the commercial energy market, only businesses who are within their renewal window are able to switch. A business’s renewal window will typically open six months prior to the end of their current contract. Only within this window are you able to approach suppliers for a business energy quote, and even accept a new contract. However, any new business energy deals that you accept will not take effect until your current deal expires.
Comparing energy prices for business is relatively straightforward, provided you follow these six steps:
- Step 1 – Check if your business is within its renewal window.
- Step 2 - Obtain business energy quotes from suppliers.
- Step 3 – Compare business energy suppliers and assess which is the best quote for your business’s needs.
- Step 4 - Apply for the new deal.
- Step 5 - Inform your current business energy supplier that you’re switching.
- Step 6 - Wait for the switch to take effect (usually, once your current contract comes to an end).
The process described above can be time consuming, and naturally business owners are busy, which is why many are on the wrong business energy tariff for their needs. However, if you use the services of a business energy broker, you will receive offers from a variety of suppliers, so you can make the best decision for your business, without the leg work of individually obtaining quotes.
What are good business energy prices?
Because each business is offered a bespoke contract for their energy supply based on its circumstances, prices will often vary from business-to-business. A supplier must consider a lot of information about your business before they are able to offer you a business energy quote.
For this reason, it’s often hard to offer an indicative price for business energy rates without first assessing a business’s circumstances. However, as a rule of thumb you should be paying anywhere between 10.5 and 12.5 pence per unit if you run a small or medium sized business.
On top of your unit price, you will also need to factor a standing charge into your business energy prices. This is a charge included on your bill to cover the cost of transporting energy to your premises, as well as the maintenance and upkeep of the network used to deliver the energy to your premises. Standing charge is a daily cost that is added onto your bill, and each supplier will charge a different rate for their standing charge.
Ultimately, your business energy prices will be determined by terms of the business energy contract that you agree with your supplier, which is why it’s important to thoroughly research the deals available to you before switch business energy supplier. But, remember price isn’t everything when looking for a good business energy tariff.
Cheap business energy
One common mistake that many businesses energy customers make is taking the cheapest deal that is offered to them. Doing this can leave you with unsatisfactory service in the event that something goes awry. When comparing business energy rates, it’s important to properly assess each quote you’re offered to ensure that the one you choose properly satisfies the needs of your business, and doesn’t simply offer a cheap price.
Why use uSwitchforbusiness?
Business energy switching with uSwitchforBusiness.com you can ensure you never have to pay over the odds for your business electricity and gas again. All you need to do is pick up the phone, so call us today on 0800 188 4930.