If you are the owner of a small business, then it’s likely that you are constantly looking for ways to reduce your expenses. In this guide, we’ll focus on how energy bills can be an easy way to make sizeable savings. For example, if you haven’t switched energy providers for a few years, then you could currently be overpaying on your electricity and water bill.
Here, we’ll discuss the different types of micro business energy tariffs that you can choose from and we’ll give you the information you need so that you can switch over to a new plan without much effort. Overall, our goal is to help you to find a cheaper energy rate.
In the UK, a micro business is defined as a company that has less than ten employees (or their full-time equivalent) and a turnover that doesn’t exceed £1.8 million per annum. In Britain alone, there is currently an average of 4.4 million businesses that operate under this definition. Examples of common micro businesses can include accounting, catering, childcare, house cleaning, and photography services.
From an energy point of view, Ofgem’s Retail Market Review classifies a micro business as:
The cost of your business’s energy will be dependent on several factors. However, the current average rate for micro businesses is 16.74p per kWh. This average figure is by no means the cheapest rate available – so, if you shop around diligently, you should be able to find deals that will beat this rate.
Apart from the rate you’ve accepted, there are also many other factors which can affect your micro business energy costs. These can include:
Because the micro business energy market is incredibly competitive, you won’t be short on options when it comes to looking for cheaper deals. You will also be offered flexibility in terms of how you are billed, and you will find that some choices will be more beneficial to your business niche than others.
When you compare business energy plans, you can choose from the following tariff types:
Fixed rate tariffs will remain the same throughout your contract. This means that the unit price of your electricity won’t fluctuate. If your aim is to have a stable rate that makes your energy bills easier to manage, then this is a viable option.
A variable rate tariff can fluctuate with a supplier’s unit rate. So, if your energy supplier’s rate goes up, then your rate will also increase. However, if the rate drops, then your tariff will also be reduced accordingly.
Unlike a standing charge tariff that has a fixed daily cost paid to your supplier (which stays the same no matter how much electricity has been consumed) – a no standing charge tariff means that your unit rate can be higher than other standard fixed rate tariffs.
If your business wants to reduce its carbon footprint, then you can choose a green energy tariff. With this option, your organisation will receive energy from renewable sources.
If this is your first time applying for energy or if you would like to switch providers, then, of course, you are going to search for a plan that offers the best rates.
The main options available to micro businesses are:
If you go with the first option, then you may miss out on a significant number of better rates. With the second choice, you’ll have to put some time and effort into finding a cheap energy deal.
This means that the last two suggestions provide the easiest solution with the possibility of significant savings.
* Important to note – Micro businesses who fail to switch plans or renegotiate their contracts before they expire will automatically be placed on a rollover contract. Rollovers tend to have the most expensive rates and could seriously impact the cost of your energy bills.
Switching micro business energy providers can be a simple, quick, and hassle-free process if you take advantage of the right resources. At Simply Switch, we can help you to find and switch over to a plan that offers better rates.
All you need to do is enter your postcode into our online comparison tool and, in minutes, we’ll provide you with a list of all the best business energy deals that are available in your area. Once you’ve chosen a deal, we can also handle the entire switch-process for you, including telling your old supplier that you’re leaving.