It’s no secret that finding the best business electricity prices and suppliers is no easy task for businesses.
In fact, there are over 50 different business energy suppliers in the UK alone, each providing their own prices, contracts, and conditions. As a result, you most likely experience a difficult time trying to find cheap business electricity prices for your business.
But today is your lucky day.
You’ve found the ultimate guide to the best business electricity rates and suppliers in the UK. Not only will you access an accurate comparison of real-time rates, but you’ll also find detailed descriptions of the top business electricity suppliers, including their range of contracts and services.
Here’s what is in this guide:
Business electricity rates, also known as tariffs, play an important part in determining your monthly expenses.
Therefore, it’s crucial for you to find the best rates in order to cut down your energy costs and allow you to easily plan ahead for future business spending.
Contrary to what you may have heard, the best business electricity rates aren’t always the lowest unit price.
There’s the standing charge, or the daily fee for your supplier to provide the electricity, as well as other factors such as contract length and business size that affect how much you end up spending on your energy bill.
So if you’re ready, let’s dive into a comparison of business electricity rates.
Business Electricity Price Comparison
In general, there are 2 components to business electricity rates: Unit Price and Standing Charge.
As you may already be aware, the unit price or price per unit is the cost of electricity usage. It is calculated in kilowatts per hour and is usually between 10p to 30p per kWh.
The standing charge can be thought of as a daily rental fee, accounting for using your supplier’s business electricity service. It is a fixed amount and is set by your supplier.
Business electricity suppliers offer 3 types of rates: fixed, variable (flexible), and deemed rates.
Fixed and variable rates are usually lower than deemed rates and are applicable when you enter into a contract with your supplier.
Deemed rates are the prices when you haven’t entered into any contract, but need to keep your supply going in the short-term. These are more expensive because they are often requested with little notice for the supplier and no guarantee of any contract.
In the comparison table below, all the listed prices are the deemed rates of each supplier for businesses under “Profile Class 03”, the category that most SMEs fall into.
You should think of the deemed rates as the maximum prices of the suppliers, which also give you an idea of what their fixed and variable rates are (as they are generally cheaper).
|Supplier||Unit Price (per kWh)||Standing Charge (per day)|
|Npower||27.08-28.21p*||£57.30-£65.67 per quarter|
As of June 20 2019
*depending on the region your business is located
Hungry for more? Keep on reading to find out more about these suppliers, including what contracts they offer and their small business-friendly features.
Business Electricity Suppliers
Did you know that almost 80% of electricity and gas in the UK is supplied by 6 companies?
The Big Six energy suppliers and their respective market share are as follows*:
- British Gas (20%)
- Southern Electric (14%)
- E.ON (13%)
- EDF (11%)
- Npower (10%)
- ScottishPower (10%)
* by end of Q4 2017
However, the past few years saw a decrease in customers and market share for the Big Six, with more businesses opting for newer, independent companies that offer 100% renewable energy and in some cases, lower business electricity rates.
Below, you will find all you need to know about key services and features of the Big Six, as well as top alternative suppliers that are becoming increasingly popular options for businesses in the UK.
British Gas is undoubtedly a household name amongst businesses, seeing as they supply 20% of all electricity in the UK and offer relatively competitive rates and plans. Their fixed rate contracts begin at 1 year and go up to 3 years.
More importantly, they focus on delivering reliable service, straightforward pricing, and fast customer support. As a UK-based supplier, their customer representatives are easily accessible and available to resolve your issues.
And to top it off, British Gas provides a simple switching process that comes with a free boiler service, even if they aren’t your current gas supplier.
SSE, formerly known as Southern Electric, is part of the Scottish and Southern Group. Following a merger with Scottish Hydro-Electric in 1998, SSE was formed with headquarters in Perth, Scotland.
They offer fixed rate contracts for business electricity that begin at 1 year, with the option to use 100% renewable energy at an increased rate. SSE business electricity solutions are specifically tailored to small business goals, such as improving efficiency and responsible growth.
In addition to that, SSE also provides experienced advisors who are able to give you valuable advice on energy saving options. When you switch to SSE, they handle the full administrative processes to ensure a smooth transition.
E.ON are one of the largest energy suppliers in the UK, who provide competitive business electricity rates with options for SMEs, as well as long-term contracts with attractive fixed prices. Their contracts start from 1 year and go up to 3 years for fixed rate plans.
But that’s not all. E.ON also gives you the option to get your electricity from 100% renewable energy under their ‘Business Green’ tariff, in an effort to reduce carbon footprints. Keep in mind that these rates tend to be higher.
What’s more, E.ON also offer free business advice from experts about how to save on energy costs. With these tips and tricks, you could easily save up to 20% on your next electricity bill.
Based in France, EDF offers some of the best business electricity rates and plans in the UK. Their fixed rate contracts begin at 1 year and go up to 3 years in the case that you decide that you want to enter into a longer contract.
EDF also provide a generous selection of tariff options that are focused towards small business needs, such as the ‘Super Saver’ package for SMEs, or the ‘Energy Saver’ package that offers no standing charges for businesses that don’t use a lot of energy.
EDF has an office location in London and provides further customer support with 24/7 online chat support.
Npower is another one of the Big Six energy suppliers, providing energy to over 365,000 businesses in the UK. They offer generous business electricity rates as an incentive for businesses that are looking to switch suppliers.
Npower provides certain business electricity packages that include features to encourage maximum savings on your energy bill, such as free energy monitors, auditing your usage and other useful tips on reducing consumption.
They have a UK-based customer support team and easy online account management to access data, reporting, and bills.
ScottishPower rounds out the Big Six energy suppliers in the UK, providing energy to over 200,000 businesses in the UK. Contrary to what their name may suggest, they supply energy businesses all over the UK, not just Scotland!
They offer fixed-rate contracts that range from 1 year to 3 years and include access to a dedicated UK Business Energy team who are on hand to provide advice on becoming energy efficient and reducing costs.
Plus, you get to take advantage of the ScottishPower self-service portal that’s not only easy to use, but is also personalized according to your preferences and most-used services.
You’ll be able to manage your account and billing whenever you want.
Founded in 2006, Haven Power is an award-winning independent energy supplier that focuses on delivering efficient and renewable energy to businesses around the UK.
Though they are a considerably smaller company than any of the Big Six suppliers, Haven Power offers a variety of simple, small business-friendly electricity rates and plans.
Haven Power offers fixed business electricity rates together with flexible contracts, which is something you won’t usually see in the Big Six, who prefer to set fixed rates with long-term contracts.
As a customer, you receive straightforward quotes and bills, which eases the stress of running your business when you know exactly what you are getting.
Haven Power also provides a UK-based support team and promises that you will receive a named, dedicated advisor to help fix your issue.
Extra Energy is another independent energy supplier for businesses in the UK. Based in Birmingham, Extra Energy was founded in 2014 and are still relatively new in the industry.
They focus on providing the best-value business electricity rates, as well as personable customer support – something which is often lacking with the Big Six. Along with their competitive rates, Extra Energy offers contracts that range from 1 to 3 years.
Founded by veterans of the energy industry, Bulb was created on the basis of offering efficiency, better service, and 100% renewable electricity to UK businesses, at an overall lower cost.
Their industry experience gives Bulb an edge over other suppliers because they know what needs to be improved in order to provide the best rates and plans for business electricity.
Bulb offers a single, simple tariff that promises to deliver a lower overall cost (on average), than any of the Big Six suppliers.
This comes with seamless online and mobile account management using the Bulb application that can monitor your energy usage, submit meter readings, and manage your invoices.
On top of all that, Bulb operates a London-based customer support team that delivers fast, personable service.
Founded in 2009, Yü Energy offers transparent contracts and small business-friendly rates for business electricity. They focus on improving customer experience and learn from the mistakes of larger suppliers to make sure they provide the best rates and contracts for businesses in the UK.
Like most suppliers, their fixed-rate contracts range from 1 to 3 years. But, you also receive a personal Account Manager who guides you through the sales process to ensure that you are set up and running smoothly.
At this point, you’re probably wondering: Besides suppliers, what else affects business electricity rates?
You’ll find the answer in this next section.
What Affects Business Electricity Rates?
The larger your business, the lower your rates.
The unit price (p/kWh) varies depending on the size of your business. Suppliers obtain their energy ahead of time and need to make sure all of their supply is sold. This means that smaller businesses that generally use less electricity will face a higher rate, as they consume a proportionately smaller amount than a large, industrial company.
In fact, the average unit price (as of June 2018) for industrial businesses was 13.39p/kWh, as opposed to micro businesses that faced 14.76p/kWh.
Therefore, you should have a clear idea of how much electricity your business needs so that you get the best rates.
Longer contracts come with higher rates than shorter contracts.
The length of your contract also has an effect on your overall business electricity cost. Since business electricity rates aren’t stable and often increase each year, longer contracts (2+ years) that also offer fixed rates will have higher rates as a trade-off for not being subject to increased rates during the contract.
There are both advantages and disadvantages to long-term contracts. While you are receiving a guaranteed fixed rate over a period of time, some businesses prefer to take their chances by regularly switching providers every year in order to get the lowest rates in the market.
Metropolitan city locations offer lower rates than rural areas.
When your business is located in a metropolitan region, it is easier for suppliers to provide electricity due to the presence of better infrastructure and connectivity. But as a business location is not something that can be easily or quickly changed, you may have to just accept your rates as they are.
The lowest business electricity rates are found in the East and West Midlands, as well as Scotland. While rural areas of Wales incur some of the highest rates.
In general, suppliers offer a discount when you choose to pay with monthly direct debit.
A higher company credit rating results in a greater chance your supplier offers a lower rate.
Certain suppliers offer lower rates if your company has a good credit rating and history. Both provide an indication that you are likely to make payment on time and in full.
How to Choose the Right Business Electricity Plan and Supplier
Plan for your electricity usage
When you have an accurate idea of how much electricity your business uses, you are able to communicate this to your supplier and obtain a fair rate. It would not be ideal if you ended up with the wrong tariff and ended up paying a higher rate than you had to.
For starters, most small to medium-sized businesses use between 15,000-25,000kWh per year.
If you know that your business uses a high amount of electricity, then you would usually be given a lower rate from your supplier.
Here’s a tip: install an energy/electricity monitor to keep track of your business’ usage.
Know what type of contract you want
Fixed-rate long-term contracts mean that your rates stay the same throughout your contract. So if you are sure that you want to stick with a certain supplier for the future, it may be a good idea to take advantage of long-term contracts and avoid the changing rates.
On the other hand, staying with shorter contracts that offer lower rates could also be a good idea if you are regularly switching suppliers to those with the current lowest rates. After all, you are getting the same type and quality of electricity!
In general, suppliers charge different rates for a certain period of electricity usage. For example, rates for the daytime, nighttime, peak hours, or non-peak hours. Make sure that you are getting the best rates during the period that your business uses the most electricity.
Business Energy & Brexit
A lot of people in Great Britain are worried about how Brexit will affect their business energy bills.
The industry trade association ‘Energy UK’ believes that higher household bills might be on the way. This could be as a result of energy issues linked to Brexit.
There are a number of ways which leaving the European Union is likely to increase energy bills across the country. They are:
- Increased transportation costs and reduced EU investment.
- Lack of a replacement for European Atomic Energy Community (Euratom).
- Pulling out of the EU Emission Trading System (EU ETS).
Comparing prices now may help secure you a better deal
Give yourself a pat on the back, you have made it to the end of this guide.
Now let’s get a start on saving on your electricity costs, implementing energy-efficient procedures, and choosing the best business electricity rates for your business!
Good luck, and let us know how it goes.