Business electricity differs from domestic electricity in that it often comes with longer contracts and carries a 20% VAT rate as opposed to the 5% rate for domestic electricity.
There are also a variety of other tariffs and levies that are added to business electricity costs. These include the Climate Change Levy, distribution and transmission costs, and metering expenses, to name a few.
If you want to save money on electricity, follow the top tips below.
5 Ways To Get The Best Business Electricity Deals
Use A Comparison Site
Comparison sites like utility bidder are very useful tools for businesses to make use of when they want to make sure that they get the best possible deals.
The rates offered by the various electricity providers change on a regular basis, and comparison sites have the most up-to-date information. They make it very easy for you to see which company has the best option for your business. There are many ways by using which you can save money on your business energy bill.
Understand Your Business’s Gas And Electricity Needs
Each business has differing needs when it comes to electricity and gas and will have differing levels of consumption. It is important that you analyse your business’s needs and find the deal that suits them best.
If you use less electricity than you are contracted for, you will be paying more than necessary. And if you use more, you will get charged penalty fees which will be more costly for the business than changing your contract to one with higher capacity.
Choose The Right Billing Period For Your Business
If you are a smaller business, your turnover may be smaller too. A smaller turnover matches well with a shorter billing period as it allows the business to manage its turnover more accurately.
Longer billing periods can work well for large businesses, as they will be able to fit them into their turnover periods more easily.
Make Sure That Your Agreed Supply Capacity Matches Your Consumption Requirements
The Agreed Supply Capacity (ASC) is the maximum electricity usage that you agree to with your provider. It is measured by the amount of electricity used in a half-hour period.
If your usage surpasses that of the ASC, you will either overload the system or you will get surcharges at the end of the billing period.
Suppose you are using significantly less than the contracted Agreed Supply Capacity. In that case, you should change your contract or supplier to something more suitable for your capacity – this will help you to save money.
Keep A Good Credit Score
Businesses with a good credit rating will have access to better deals, as electricity companies will be more willing to enter into contractual agreements with them.
A bad credit rating will make companies wary of doing business with you as they will be concerned about potential non-payment.
Other Ways To Reduce Your Electricity Costs
Electricity Usage Audits
Running a regular analysis of the electricity usage in your business will allow you to collect data on where you are using more electricity than necessary. This will help you to adjust your electricity contracts to ensure that you are not paying more than you should be.
This should be done on a quarterly or 6-month basis to give the business the most benefit. Contract changes might not be able to be made as frequently, but the data will be beneficial for future negotiations.
Switching Off Lights And Computers
While this might seem like something that every dad asks you to do, it really does have a big impact on long-term electricity consumption. Studies have shown that turning computers off overnight and on weekends could reduce business electricity consumption by as much as 75% per year!
This will require some staff training and reminding, but it is a change worth implementing in the workspace – not only will it reduce your electrical bill, but it will also be good for the planet (and the computers – they need a break too!).
Switch To Sustainability
Changing your lights and appliances to more energy-efficient versions is a worthwhile process. It will reduce your electricity consumption in the long term. The more energy-efficient bulbs last longer than your standard halogen bulbs.
While a toasty room can be great, keeping the office slightly cooler (by as little as one degree lower) can further reduce costs. Keeping the heating at a consistent temperature will also help to prevent additional expenses.
Final Thoughts
With the constant changes happening in the electricity market, it is important to keep an eye on the needs of your business and to make sure that you are getting the best possible deal. Gathering data will assist you in reducing your costs successfully.
