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Business Electricity Tariffs Explained


Comparing business electricity tariffs can be confusing with so many options available to customers. A variety of unit prices, contract lengths and standing charges can make it difficult to know which business electricity supplier you should choose. However, SwitchMyBusiness.com is here to help! With this article, we will guide you on which factors impact your electricity plan and what may increase energy costs for your business.

Contract Length

Contract length can make a big difference in business electricity prices. Contracts can vary from 12 months to 36+ months, and the price per kWh for each may be very different. In general, the shorter your energy contract, the lower the unit price is likely to be.

However, when considering the long term, there are exceptions to this rule. For example, if you decided to choose a 36 month contract with fixed electricity prices and the cost of electricity increased within the first year of your contract, your business is likely to spend less on energy than if you had organised a 12 month contract as costs have been frozen for three years.

Electricity unit prices may initially be higher on longer contracts as suppliers need to predict future business electricity prices, and as energy rates typically increase, this needs to be planned for.

Location

Your business location can impact electricity rates, as suppliers may incur higher costs when providing particular businesses with energy. Businesses in more rural locations are likely to be charged more for the energy they consume as it is more difficult for suppliers to reach rural areas than if your business was based in a city.

Consumption

Although it may be difficult for electricity suppliers to predict how much energy business customers are likely to use compared with domestic customers, as a business’s electricity consumption increases, the average price per kWh typically decreases. For example, a business with an annual electricity usage between 5,000-15,000kWh will on average pay 12.5p per kWh, whereas a business with an annual usage between 30,000-50,000kWh will pay 10.5p per kWh on average.

Business electricity suppliers buy their energy in advance, so it is important to let your supplier know how much your business is likely to use within a year. Suppliers also need to predict how much your business will use over the next two or three years depending on your contract length, so being clear about your business’s electricity consumption is very important.

Electricity Rates change daily

Electricity rates change on a daily basis and this can impact the business energy quotes you receive as they may change day-to-day. We understand it can be confusing when comparing electricity prices as the volatility of the market can very quickly alter the prices businesses are originally offered. This is why we encourage customers wanting to compare electricity prices to act quickly when they find a tariff they like to avoid disappointment if energy prices increase.

It is clear to see there is a wide range of factors that influence business electricity rates, and this makes it easier to understand why there are so many different electricity tariffs. We know how confusing it can be to compare business electricity rates when there are so many factors to consider, and that’s why we encourage business customers to use our quick and easy comparison service! Our energy-switching experts will help you compare the best energy tariffs for your business, and once you’ve chosen your favorite, we’ll complete your switch for you!

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Excellent, 9.8 / 10

Christine Rogerson

"Christine Rogerson was very helpful. She advised me on my energy requirements and worked out the best tariff that fit with my need and budget. She wasn't pushy at all. I do not like dealing with energy companies but Christine seemed a very considerate and genuine person. I am happy with the contracts that she has advised for me. Many thanks."

This review was posted by Bilal Riaz on the 15th of October 2019

Bhavni was lovely.

"Bhavni was lovely. I had previously spoken to her regarding another agent from a different company that lied to me. She advised me on the law of selling energy. She wasn't pushy at all. I do not like dealing with energy companies but Bhavni seemed a very considerate and genuine person. I am happy with the contracts that she has arranged for me. She also advised me on how to stop cold calling. Many thanks."

This review was posted by Helen Mitchell on the 15th of October 2019

Luke Hibbert was excellent and…

"Luke Hibbert was excellent and transferred over my electric and gas accounts and saved me a good amount of money! very happy with service."

This review was posted by Michelle on the 14th of October 2019

Bhavni Manek Was very helpful and…

"Bhavni Manek Was very helpful and patient throughout our time selecting a business tariff. I am very happy with this service and will be recommending yourself and the company."

This review was posted by Stephen Jones on the 14th of October 2019

Very helpful

"Very helpful, and most importantly very quick service. No gassing just sorting the issues quickly"

This review was posted by Lewis Fulton on the 14th of October 2019