Why You Need to Save Money on Your Business Electricity Bills in 2023
Electricity is one of the most essential and expensive utilities for any business. According to the Department for Business, Energy and Industrial Strategy (BEIS), the average electricity price for small and medium-sized enterprises (SMEs) in the UK was 15.37 pence per kWh in 2021. This means that a typical SME with an annual electricity consumption of 20,000 kWh would spend about £3,074 on electricity bills per year.
However, electricity prices are expected to rise in the coming years due to various factors, such as the increasing demand for electricity, the phasing out of coal-fired power plants, the uncertainty of Brexit, and the impact of climate change . According to a report by Cornwall Insight, the average electricity price for SMEs could reach 18.22 pence per kWh by 2023. This means that the same SME would spend about £3,644 on electricity bills per year, which is an increase of £570 or 18.5%.
Therefore, it is crucial for businesses to find ways to save money on their electricity bills in 2023 and beyond. Not only will this help them reduce their operating costs and increase their profitability, but it will also help them reduce their carbon footprint and contribute to the UK’s net zero target by 2050.
In this article, we will show you how to save money on your business electricity bills in 2023 by following these three steps:
- How to compare electricity suppliers and find the best deal for your business
- How to reduce your electricity consumption and improve your energy efficiency
- How to switch to renewable energy sources and benefit from government incentives
How to Compare Electricity Suppliers and Find the Best Deal for Your Business
One of the easiest and most effective ways to save money on your business electricity bills in 2023 is to compare electricity suppliers and find the best deal for your business. Unlike domestic customers, who can switch their electricity supplier every year, business customers have to wait until their contract expires before they can switch. This means that you may be stuck with a supplier that charges you more than the market rate or does not offer you the best service.
Therefore, it is important to shop around and compare different electricity suppliers before you sign a new contract or renew your existing one. You can use online comparison tools, such as Business Energy or uSwitch, to compare electricity prices and plans from various suppliers. You can also contact suppliers directly or use a broker or consultant to help you negotiate a better deal.
Alternatively, you can visit British Business Energy which is a website that provides you with useful information and tips on how to save money on your business electricity bills. You can also get free quotes from different suppliers and find the best deal for your business.
When comparing electricity suppliers, you should consider the following factors:
- The unit rate: This is the price you pay per kWh of electricity you use. You should look for a supplier that offers you a low and fixed unit rate that does not change with market fluctuations.
- The standing charge: This is a fixed daily or monthly fee that covers the cost of maintaining the network and supplying electricity to your premises. You should look for a supplier that offers you a low or zero standing charge.
- The contract length: This is the duration of your agreement with the supplier. You should look for a supplier that offers you a flexible contract length that suits your business needs and allows you to switch easily if you find a better deal elsewhere.
- The customer service: This is the quality of service and support you receive from the supplier. You should look for a supplier that has a good reputation, responds quickly to your queries and complaints, and provides you with clear and accurate billing information.
By comparing electricity suppliers and finding the best deal for your business, you could save up to 40% on your business electricity bills in 2023.
How to Reduce Your Electricity Consumption and Improve Your Energy Efficiency
Another way to save money on your business electricity bills in 2023 is to reduce your electricity consumption and improve your energy efficiency. This means that you use less electricity to perform the same tasks or achieve the same results. By doing so, you not only save money on your bills, but also reduce your environmental impact and enhance your brand image.
There are many ways to reduce your electricity consumption and improve your energy efficiency, such as:
- Switching to LED lighting: LED lights use up to 80% less energy than traditional incandescent or halogen bulbs. They also last longer, produce less heat, and provide better quality light. By switching to LED lighting, you could save up to £240 per year on your business electricity bills.
- Installing smart meters: Smart meters are devices that measure and display your real-time electricity usage and cost. They also send this information to your supplier automatically, eliminating the need for manual meter readings and estimated bills. By installing smart meters, you could save up to 10% on your business electricity bills by monitoring and managing your consumption more effectively.
- Using energy-efficient appliances: Energy-efficient appliances are devices that use less energy than standard ones to perform the same functions. They also have a lower environmental impact and a longer lifespan. By using energy-efficient appliances, such as computers, printers, refrigerators, and air conditioners, you could save up to 30% on your business electricity bills.
- Implementing energy-saving behaviours: Energy-saving behaviours are actions that you and your employees can take to reduce your electricity consumption and waste. They include turning off lights and appliances when not in use, adjusting the thermostat and ventilation settings, using natural light and ventilation, and avoiding overloading sockets and extension cords. By implementing energy-saving behaviours, you could save up to 20% on your business electricity bills.
By reducing your electricity consumption and improving your energy efficiency, you could save up to £1,000 per year on your business electricity bills.
How to Switch to Renewable Energy Sources and Benefit from Government Incentives
A third way to save money on your business electricity bills in 2023 is to switch to renewable energy sources and benefit from government incentives. Renewable energy sources are sources of energy that are derived from natural resources, such as wind, solar, hydro, biomass, and geothermal. They are clean, green, and sustainable, unlike fossil fuels, such as coal, oil, and gas, which are finite, polluting, and contribute to global warming.
By switching to renewable energy sources, you can reduce your dependence on fossil fuels, lower your carbon emissions, and support the UK’s transition to a low-carbon economy. You can also benefit from government incentives, such as the Feed-in Tariff (FIT) scheme and the Renewable Heat Incentive (RHI) scheme, which pay you for generating and using renewable electricity and heat .
There are two main ways to switch to renewable energy sources for your business:
- Generating your own renewable electricity: You can install renewable electricity generation systems on your premises, such as solar panels, wind turbines, or hydroelectric generators. These systems can provide you with free or low-cost electricity for your own use or export to the grid. You can also earn money from the FIT scheme, which pays you a fixed rate for every kWh of electricity you generate and export.
- Buying renewable electricity from a supplier: You can buy renewable electricity from a supplier that sources it from renewable generation plants or projects. These suppliers can provide you with green tariffs or certificates that guarantee that the electricity you use is matched by an equivalent amount of renewable electricity generated elsewhere. You can also save money by choosing a supplier that offers you a competitive price and a long-term contract.
By switching to renewable energy sources and benefiting from government incentives, you could save up to £500 per year on your business electricity bills.
How to Save Money on Your Business Electricity Bills in 2023 and Beyond
We have shown you how to save money on your business electricity bills in 2023 by following these three steps:
- How to compare electricity suppliers and find the best deal for your business
- How to reduce your electricity consumption and improve your energy efficiency
- How to switch to renewable energy sources and benefit from government incentives
By following these steps, you could save up to £2,000 per year on your business electricity bills in 2023. This is equivalent to a 55% reduction from the average annual bill of £3,644 for a typical SME in 2023.
However, saving money on your business electricity bills is not only a short-term goal but also a long-term strategy. By adopting these steps now, you can prepare your business for the future challenges and opportunities of the energy market. You can also improve your business performance, reputation, and competitiveness in the increasingly green and digital economy.
Therefore, we encourage you to take action today and start saving money on your business electricity bills in 2023 and beyond.
