Business Energy

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Satisfied Customers

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Kathleen B

My Advisor Alisha was fantastic, she explained my new tariff in simple terms that I could understand and talked me through the procedure, I wish all other companies employed staff like Alisha.

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Chloé P

James was a lovely person who was very patient with me as I am a first time house owner and this is all new to me so he took his time with me and explain everything to me. James also answered any questions I had and made sure I was happy with everything. He also found me a cheaper tariff then what I was on which i really appreciate.

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Matt

Colette was a joy to deal with and informative and explained the whole process also went through the Carbon Offsetting, exceptional young lady, thanks Colettte

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How does business energy work?

Thinking of switching your business gas or electricity? There are a few key differences between business energy and home energy that you’ll need to be aware of before carrying out an energy comparison. Read on to discover what makes business energy different, see your contract options and find out how much your business should be paying for gas and electricity. 

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Find better business energy.

Save an average £1,305* on your business energy bills when you switch with Selectra.

What are the differences between business energy and home energy?

  • Cheaper rates: Unlike domestic energy, which is bought and sold on a monthly basis, business energy is purchased in bulk, commercial suppliers buy enough gas and electricity to last the full length of your contract. Although this may mean you get a lower unit rate, it can also make terminating your tariff early more difficult and expensive.

  • Longer contracts: While both fixed and variable rate business energy tariffs are available, commercial energy contracts can last up to five years. Unlike with a home energy tariff, which allows users to change suppliers at any point, business energy users can only switch away during their renewal window. A renewal window is usually six months before the contract expires, but it can be as short as just a few weeks in some cases.

  • Bespoke quotes: With home energy tariffs, you'll typically pay the same unit rate regardless of how much energy you use. This is not the case for businesses. As companies can vary greatly in size and energy usage, business energy suppliers create bespoke quotes instead. While this means you'll get a quote tailored to your specific needs, it can make it more difficult to know if your business is getting a competitive deal or not.

  • Single fuel only: Business energy suppliers don’t offer dual fuel contracts. This means that business owners wanting both gas and electricity must sign up for separate contracts, with varying unit rates and standing charges - and potentially different end dates.

  • No time to cool off: Unlike domestic energy tariffs, which have a 14 day cooling-off period, once you’ve signed your business energy contract, you're locked in immediately. This is why it’s vitally important to get the best deal for your business the first time.

No business owner should be stuck with uncompetitive prices for several years. Here at Selectra, our energy experts are always available to help you find the best deal. They do the legwork of gathering customised quotes from multiple suppliers - all you have to do is pick the best one for your business. Speak to one of our friendly advisors for free on 020 3318 3633 or start a quote now.

What types of business tariffs are available?

Business energy bill and saved money

There are four main types of energy tariffs that businesses can choose from:

  • Fixed-term contracts: With a fixed-term business energy tariff, prices are locked in for the duration of your contract. Fixed-term tariffs are usually available from one to four years. While your bills will vary depending on how much energy you use, the unit cost (price per kWh) and standing charge (daily cost of using energy) will remain consistent throughout the term of the contract. Longer fixed-term tariffs are usually more expensive per unit, but they protect you against any future price hikes.

  • Extended tariffs: Extended tariffs allow you to stay with your current business energy supplier for a longer period of time. If you're happy with your current provider, opting for an extended tariff could be a good idea, as they'll often reward you with lower rates if you stay with them. However, another supplier may be able to undercut these prices, so it's still always worthwhile to compare.

  • Flexible tariffs: If you’re able to afford the upfront payment, you could save a lot of money with a flexible business energy tariff. A flexible tariff enables you to purchase energy in bulk in order to benefit from wholesale prices. This type of tariff can help with budgeting because you'll know exactly how much you've spent on energy before you use it. However, there's a chance your prices could rise once the contract comes to an end.

  • Pass-through tariff: You can split your bill between fixed wholesale prices and variable expenses such as energy distribution costs with a pass-through tariff. While you might save money if those variable costs don't rise during your contract's term, it’s worth keeping in mind that the lack of price certainty can make budget forecasting a little more difficult on this type of business energy tariff.

Can businesses get dual fuel tariffs?

Unlike home energy users, dual fuel tariffs are not available to businesses. This is because business energy contracts are customised and bespoke. Suppliers require information and the size and energy usage of your business before deciding on the rates to offer you.

Some business energy suppliers do, however, offer better deals to businesses that buy both electricity and gas from them. Even so, going with separate suppliers may still be less expensive, which is why you should always compare before switching.

How is my business energy calculated? 

When comparing business energy prices, there are two main costs to take into account:
 

  • Unit rate: The unit rate specifies how much each kilowatt-hour (kWh) of energy will cost you. This is what makes up the biggest part of your energy bill. Depending on your energy consumption, you will generally pay less the lower your unit rate is. Signing up for a contract with a fixed unit rate will help your business avoid price increases during the contract's term.

  • Standing charge: The standing charge is a fixed price daily charge that covers the cost of infrastructure repair and maintenance. This cost remains the same for the duration of your contract.

These costs can depend on a number of factors, such as where in the country your business is located, what type of business it is, your contract length, payment method and your credit score.

Other costs and government fees (such as VAT and the Climate Change Levy) are also factored into your business energy bills. However, these are usually out of your supplier's control so, unfortunately, they are unlikely to change if you switch.

Save yourself the time and hassle of calculating these costs with Selectra. Get in touch with one of our energy experts today by calling 020 3318 3633 today or get a free quote now and let us do the hard work for you.

Is business energy cheaper than domestic energy?

While both business and domestic energy plans are measured in the same units, they actually differ significantly interms of both cost and contract details.

The cost of a unit of gas or electricity for a business customer can often be less than for a domestic customer. Businesses pay a lower unit price for energy, owing to the volume of energy they need. The larger your business is, the lower the unit price will be. 

Commercial energy customers can also negotiate and select contracts based on their business’s specific requirements. Domestic energy is not offered at these customised rates - instead, they are charged the same amount as the rest of their region.

While switching home energy suppliers is straightforward enough, comparing the best business  gas and electricity providers for your business can be much more complicated and time consuming. Here at Selectra, we’ve teamed up with Bionic to find the best commercial electricity deals for your business. Speak to an energy expert on 020 3318 3633 or start a quote now. We'll handle the switch for you and have you saving money in no time.

How much energy does my business use?

Every business has its own specific energy needs, but here is a breakdown of average gas and electricity consumption for micro, small, and medium-sized businesses to give you a rough sense of how much energy your business should be using.

Average business electricity consumption
Type of business Number of employees Turnover Average annual electricity usage Average annual gas usage
Microbusiness Less than 10 Less than £1,400,000 5,000 - 15,000 kWh 5,000 - 15,000 kWh
Small business 11 to 50 Between £1,400,000 and £7,000,000 15,000 - 25,000 kWh 15,000 - 30,000 kWh
Medium business 51 to 250 Between £7,000,000 and £31,000,000 25,000 - 50,000 kWh 30,000 - 65,000 kWh

How much does business energy cost?

The tables below break down the average gas and electricity rates for businesses. Generally speaking, the more energy your business consumes, the lower the cost per unit.

Average business electricity costs
Type of business Average electricity unit rate Average electricity standing charge Average electricity annual spend
Microbusiness 16.6p - 18p per kWh 25p - 32.5p per day £1,834
Small business 16.2p - 17.7p per kWh 25p - 34.5p per day £3,468
Medium business 16p - 17p per kWh 25p - 33.8p per day £6,705
Average business gas costs
Type of business Average gas unit rate Average gas standing charge Average gas annual spend
Microbusiness 5p - 5.1p per kWh 19p - 25p per day £400 - £820
Small business 4.5p - 5p per kWh 19p - 25p per day £820 - £1,458
Medium business 4.3p - 4.5p per kWh 24p - 25p per day £1,458 - £2,239

Who is the best business energy supplier?

As business energy quotes are bespoke, the best supplier depends entirely on the unique energy needs of your business. What works for one business might not be the right choice for another.

At Selectra, our trusted business energy supplier panel includes everything from independent upstarts to established energy giants. No matter how big or small your company is, we'll find the right supplier for you.

Here is a list of the business energy providers we compare through our partners Bionic:

Which is the best business energy supplier?
Energy Supplier Business Electricity Business Gas Renewable Energy  
British Gas      
British Gas Lite      
British Gas Plus      
British Gas Core      
Corona Energy      
CNG Energy      
Crown Energy      
EDF Energy      
Engie      
E.ON      
Gazprom      
Haven Power      
Npower      
Octopus Energy      
Opus Energy      
Orsted      
Scottish Power      
Shell Energy      
Smartest Energy      
Squeaky Energy      
SSE      
TotalEnergies Gas & Power      

To get a free business energy comparison, simply give a Selectra energy advisor a call on 020 3318 3633 or start a quote now

Our energy experts will use smart data to find the energy deals that meet your business's specific needs. All you have to do is tell us which one you prefer. We'll take care of the rest, including notifying your old and new suppliers about the switch to ensure everything runs smoothly, on time, and without disruption.

Learn more about business energy with our guides

Frequently Asked Questions

How to compare business energy prices

We understand that comparing business energy prices can be rather time-consuming. Electricity and gas tariffs for businesses work differently to those for domestic energy. Different types of meters, higher consumption and more complex pricing mean that it can sometimes be confusing just to know where to start when looking for a personalised business energy quote.

Together with our partners Bionic, we compare a vetted panel of trusted UK business suppliers, including British Gas, Engie, E.ON, Octopus, Scottish Power and many more.

To compare business energy prices, speak to a Selectra energy expert on 020 3318 3633 or get an online comparison.

No matter whether you own a salon, a restaurant or a shop, we can help you find the best deal for your business, regardless of its energy demands.

What do I need for a business energy comparison?

We can start a business energy quote with just your business name and address. However, to get the most acurate business energy comparison you should try and gather the following information, which can all be easily found on your bill:

  • Your annual consumption: To compare business energy prices, you should use your own consumption levels in order to get an accurate quote. You can find this information on any bill or renewal letter from your current supplier.

  • Your current contract details: If you are currently in a contract, you will not be able to switch to a new deal until your current one comes to an end. However, it is possible to sign contracts in advance in order to take advantage of the current offers - you just won’t be able to switch quite yet. Contracts usually have a renewal period during the last one to six months. During this time, you are able to compare business energy tariffs and switch to a better deal, even if the contract has not expired completely.

  • Your current business gas and electricity rates: You’ll want to compare quotes against your current business energy rates to see just how much you’ll save by switching. Your rates are broken down into two separate costs: unit rates and standing charges. You’ll have different rates for your business gas and electric. The unit rate is what you pay per kilowatt-hour (kWh) of energy that you consume, while the standing charge is the price you pay per day just to remain connected to the supply. On top of this, most businesses will also have to pay 20% VAT. However, if you run a microbusiness, a charity or a non-profit organisation, you may qualify to pay just 5% VAT. To see if you could benefit, you should ask your provider for a VAT declaration form.

What factors affect business energy costs?

It’s important you understand that business energy plans are much more complex than with domestic properties. Business energy suppliers don’t offer dual fuel tariffs, so business gas and electricity must be compared separately. Pricing can also significantly vary depending on the following factors:

  • The type of business you operate. Not all businesses run Monday to Friday from 9am to 5pm. Businesses that consume more energy at night or at the weekend will usually pay lower rates during these off-peak hours since there is less overall demand.

  • The location of your business. Business energy prices vary depending on the region in which your business is located. If your business is based in a rural area, you can generally expect to pay more than if it were located in the city.

  • The size of your business. The larger your business, the more buying power you have. If your business has multiple premises, you’ll be able to negotiate a better offer than if you were to operate from just one location.

  • The amount of energy your business consumes. The more energy your business uses, the more likely you are to get a better price per unit of energy that you use.

  • The type of tariff. Tariffs can have fixed or variable rates. Fixed-rate tariffs protect businesses from fluctuating prices for the duration of the agreement, while variable tariffs reflect the market.

  • The length of your contract. Business energy contracts can usually last anywhere from one to five years. While longer fixed-rate contracts generally have higher rates than short-term contracts, you could actually save more in the long run because these prices will be protected from any market increases.

  • Your credit rating. If you’ve got a low credit score, you could end up paying more for business energy because you are seen as a higher risk.

What is the average annual energy consumption for a business?

To compare business energy prices, you should use your own consumption levels in order to get an accurate quote. You can find this information on any bill or renewal letter from your current supplier.

To give you an idea of how much electricity and gas your business consumes, refer to the table below.

Average business energy consumption
Type of business Number of employees Turnover Average annual electricity usage Average annual gas usage
Microbusiness Less than 10 Less than £1,400,000 5,000 - 15,000 kWh 5,000 - 15,000 kWh
Small business 11 to 50 Between £1,400,000 and £7,000,000 15,000 - 25,000 kWh 15,000 - 30,000 kWh
Medium business 51 to 250 Between £7,000,000 and £31,000,000 25,000 - 50,000 kWh 30,000 - 65,000 kWh

What are the average energy costs for a business?

The table below breaks down the average electricity rates for businesses. Generally speaking, the more energy your business consumes, the lower the cost per unit.

Average business electricity rates
Type of business Average electricity unit rate Average electricity standing charge Average electricity annual spend
Micro business 16.6p - 18p per kWh 25p - 32.5p per day £1,834
Small business 16.2p - 17.7p per kWh 25p - 34.5p per day £3,468
Medium business 16p - 17p per kWh 25p - 33.8p per day £6,705

What is a good rate for business electricity?

To give you a clearer idea of how much you could save by comparing business energy quotes, take a look at the following table to see the average electricity rates paid by other businesses in your sector.

Average business electricity costs by sector
Business type Unit rate (per kWh) Standing charge (daily) Cost per year
Coffee Shop 13.42p 26.70p £2,109
Dental Surgery 13.84p 27.61p £2,176
Hair Salon 13.88p 27.23p £2,182
Newsagent 14.51p 24.28p £1,830
Restaurant 14.87p 25.46p £3,067
Small Farm 14.19p 24.21p £2,218

Average business gas rates

In the following table, you will find the average gas prices for businesses, which tend to be around 3-4 times cheaper than business electricity rates. Gas meters record how much gas has been used in cubic feet (ft3) or cubic meters (m3), despite the fact that customers are billed in kilowatt-hours (kWh). For the most accurate business energy comparison, find out how to convert gas units to kWh.

Average business gas prices
Type of business Average gas unit rate Average gas standing charge Average gas annual spend
Micro business 3.9p - 4.5p per kWh 25p - 37p per day £530
Small business 3.8p - 4.5p per kWh 25p - 45p per day £1,150
Medium business 3.4p - 4.2p per kWh 25p - 61p per day £1,860

Who is the best business energy supplier?

To help you compare business energy suppliers, check out our business supplier guides and learn more about what they have to offer.

How long does it take to switch?

It usually takes on average between four to six weeks to switch business energy suppliers, though your business circumstances or an objection from your current supplier can affect switching times. If you decide to switch and the process takes longer than six weeks, you should contact your supplier for a progress update.

When you switch your business energy supplier, our partners Bionic will notify both your current and new energy providers to ensure a smooth transition. Your new business energy supplier will then get in touch with information about when the switch will take effect. 

Will my business energy supply be disrupted when switching?

You can rest assured that there will be no break in your gas or electricity supply when you switch business energy supplier. You will not experience any sort of power cut during the switch, and no one should have to come to your business premises to replace any meter, pipes or cables.

Does my business credit score affect my ability to switch business energy suppliers?

If your company has a low credit score, a short credit history, or is in a high-risk industry, your options for energy suppliers and tariffs may be more limited. While some energy providers will not offer energy deals to businesses with bad credit, others may charge inflated rates or a premium to reflect the increased risk.

Which business energy suppliers do you work with?

Through our partners Bionic, we are able to offer quotes from the following business energy suppliers:

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*Of Bionic customers who made a saving on a three-year business energy contract between January 2020 and May 2020, the average amount saved was £1,305.