A Guide to Business Energy Rates

By Olivia Johnson - Trusted UK Business Expert

8th of December 2024

3 minute read

When it comes to running a business, managing overheads is crucial. One significant expense for many businesses is energy. Understanding business energy rates is key to ensuring you’re getting the best deal for your company. In this guide, we’ll cover everything you need to know about business energy rates in the UK. 

Business energy rates are the costs companies pay for electricity and gas. These rates can change based on usage, time, and provider. Knowing how to choose the right rate helps businesses manage their energy costs well.

There is much more to know about business energy rates. Keep reading to find out how to choose the best rate for your business and save money on energy bills.

Ready to find the best energy rate for your business? Click the link below to get started and save on your energy bills today!

What Are Business Energy Rates? 

Business energy rates are the prices that commercial entities pay for gas and electricity. These rates differ from domestic rates due to the varying energy consumption patterns and needs of businesses. Business rates often include additional charges, such as the Climate Change Levy (CCL) and the Meter Operation Service Agreement (MOP). 

According to a 2023 survey by the Federation of Small Businesses (FSB), energy costs account for approximately 20% of the overall operating expenses for small and medium-sized enterprises (SMEs) in the UK, making it one of the most significant overheads for businesses.

This is a sample based on typical rates available for small and medium-sized enterprises (SMEs) in the UK. These rates can vary depending on location, usage, and other factors, but here is a general comparison:

Sample Rate Comparison for UK Business Energy Providers

Energy Provider Standard Rate (p/kWh) Renewable Rate (p/kWh) Contract Length (Years) Customer Service Rating (out of 5)
British Gas 16.0 17.2 1-3 4.0
EDF Energy 15.5 16.5 1-3 4.3
E.ON 15.8 16.7 1-3 4.1
Scottish Power 15.9 17.0 1-2 4.2
SSE 16.2 17.5 1-2 4.0

Explanation of the Table:

  • Standard Rate (p/kWh): The price per kilowatt-hour for standard energy supply.
  • Renewable Rate (p/kWh): The price per kilowatt-hour for energy sourced from renewable sources.
  • Contract Length: The typical length of the energy contract offered.
  • Customer Service Rating: Average customer satisfaction rating based on reviews and surveys.

This table provides a general idea of the rates and services offered by some of the main UK business energy providers. For exact quotes and details tailored to your business, it’s always best to contact the providers directly or consult with an energy broker.

How Are Business Energy Rates Calculated? 

Business energy rates are calculated based on several factors, including: 

  • Energy Consumption: The more energy your business uses, the lower the unit price may be. 
  • Meter Type: Different meters have different rates. Half-hourly meters, for example, may have different rates compared to non-half-hourly meters. 
  • Location: Energy rates can vary depending on where your business is located due to factors such as distribution costs and local taxes. 
  • Energy Supplier: Each supplier sets its own rates, so it’s important to compare quotes from different suppliers.

Comparing Business Energy Rates In The Uk

Types of Business Energy Contracts 

There are several types of contracts available for businesses: 

  • Fixed-Rate Contracts: These contracts offer a fixed unit price for a set period, providing price stability and protection against market fluctuations. 
  • Variable-Rate Contracts: With variable-rate contracts, the unit price can change at any time, often in line with market conditions. 
  • Deemed Rate Contracts: These contracts are often more expensive and occur when a business moves into premises and uses energy without agreeing to a specific contract. 

FAQ 

Can I switch my business energy supplier?

Yes, businesses can switch energy suppliers. It’s advisable to compare quotes regularly to ensure you’re getting the best deal. 

How long does it take to switch business energy supplier?

The switching process can take anywhere from four to six weeks, although it can sometimes be quicker. 

Will my business experience any downtime during the switch?

No, your energy supply will not be interrupted during the switch. The process only involves a change in billing and customer service. 

Are renewable energy options available for businesses?

Yes, many suppliers offer renewable energy options for businesses looking to reduce their carbon footprint. 

Conclusion 

Understanding business energy rates is essential for managing your company’s finances effectively. By comparing quotes, choosing the right contract, and considering renewable energy options, you can ensure your business is getting the best possible deal on its energy supply.

Navigate business energy rates with confidence. Find the best rates for your company today!