Costs quickly add up when running a business. But there are ways to save money, such as with your electricity bill, which is likely to be a significant overhead.
The simple message is, don’t stick to the same supplier or tariff out of habit. In a few easy steps you could find a better deal for your company.
How to switch
Many business owners stick to their current electricity provider out of ease, rather than value for money. But, did you know that making that one change could save you hundreds of pounds in bills every year?
It’s worth your while switching, but if you don’t know where to start, try our comparison tool to size up deals and get a business electricity quote. There are several factors to consider:
When do you use electricity the most?
Some tariffs offer deals where they lower the price for electricity usage at certain times.
You can either monitor your business operations by eye and guesstimate, or use a smart meter to get an accurate reading of when your business uses the most electricity.
If your peaks are on Saturday and Sunday, you should pick a tariff that offers weekend deals with lower prices for each unit used. Other tariffs offer lower rates for evening and overnight consumption.
Types of tariff
You will find two main types of tariff on offer. Choose a fixed-rate if you prefer to pay a set amount for each unit of electricity you use. Bear in mind that you will be on this rate for the full term of your contract. This will typically range from one to five years.
On the other hand, you could opt for a variable rate which will rise and fall with the prices of the wholesale energy market. While there’s the opportunity to benefit from cheaper costs than average, you may also have to pay out more than if you chose a fixed rate, if wholesale prices rise.
Standing charge
The standing charge is a flat rate you pay for access to the electricity supply. Some firms have higher standing charges and lower prices per unit, some structure their prices the other way round. Comparing quotes will help you choose the right combination for your business.
Green energy
As the country sets its sights on becoming carbon neutral by 2050, you may want to opt for a tariff with sustainability in mind. Some electricity suppliers will give feed in as much renewable electricity as you use into the National Grid.
You’ll still get the same power through your wires as everyone else, but at least you know your bills are sustaining the eco effort.
Exit fees
Also watch out for a charge if you end your contract early. It usually works out cheaper to stick with the same provider and complete your contract term. You’ll be given notice of when it’s due to end, which is your signal to start shopping around for a cheaper deal.
Dual fuel
Although combined electric and gas tariffs are not available to businesses in the same way they are to domestic customers, you could use the same provider for both under separate contracts.
Arranging your supply in this way might enable you to negotiate a discount from your supplier, especially if you are a heavy consumer of one or both types of fuel.