Business Electricity Comparison – What Should You Consider?


When working out which business electricity supplier is best for you, you need to do more than compare two or more business electricity suppliers. That is for you to see which one provides you with the package that best fits your needs.

It’s more than finding out which ones offer you the best unit rate and a low standing charge.

You’ll also want to review other factors and use them to find a provider that offers competitive pricing without compromising quality. For example, you should consider their online customer service scores and tariff types. These are just a few of what you should look for in any service or product.

When weighing up a new business electricity deal, you’ll need to review these factors to determine whether it’s right for your company. Let’s have a look at each of them now.

Unit Rate

Unit Rate is the total cost of electricity divided by the energy consumed.

It can change depending on what time of day you use electricity. The costs associated with different times of day are known as peak and off-peak rates.

Off-peak is cheaper than peak because electricity demand is low, and plenty of supply is available. Conversely, peak times are when electricity demand is high, and there’s less supply available.

You can calculate this by multiplying the cost per kWh by 1000. This makes it easier to compare prices as they are all stated in units of pence per kWh (or pence/kWh).

For example, if you use 1,000 kWh per month and pay £100 per month for your electricity, your unit rate would be £0.10/kWh.

Standing Charge

In the UK, the standing charge is a fixed, non-fluctuating amount charged for the electricity you use, in addition to your unit rate. Your energy company sets this and is often higher than its unit rate.

Your standing charge is usually made up of two parts:

A basic service or ‘supply charge’ covers fixed costs such as meter readings, billing, and customer service. This can vary slightly between suppliers but will usually be around £10 or less.

An electricity supply component covers the cost of buying energy from the national grid (plus a margin). This will vary according to how much electricity you use each month – the more electricity you use, the higher this component will be.

In addition, the standing charge is calculated differently depending on which region of the UK you live in.

In Scotland and Wales, the average cost per kWh of electricity supplied to customers during the previous year is multiplied by your estimated annual consumption.

England and Northern Ireland use a flat rate per kWh of electricity supplied to customers during the previous year multiplied by your estimated annual consumption.

Finally, it will vary depending on your tariff and how much electricity you use.

Most suppliers in the UK charge a standing charge based on the previous 12 months’ usage, although some use three months.

For example, if you use an average of 3,000 units each month for 12 months and have no discounts or other savings applied to your account, then the standing charge would be £18.67 (3,000 x 12 x £0.0016).

However, if you used more than this amount, your standing charge would be higher – say £19.50 (3,500 x 12 x £0.0016).

Customer Service Scores

Customer service is integral to any business, but it’s especially so for electricity providers. It measures how satisfied customers are with a company’s service. 

It can be measured using surveys or by analyzing complaints made against them. The higher the score, the better the customer service.

In the UK, all energy companies must submit data on customer service scores to Ofgem every year. They must publish this data on their websites (you can find it on ours), and Ofgem publishes an annual report on this information for all companies to see.

Tariff Types

Electricity prices can vary depending on whether you’re a domestic or business customer, and even within those categories, there are many different tariffs.

But basically, the energy market in the UK has split into two parts: the wholesale market and the retail market. The wholesale market consists of the power plants that produce electricity and the National Grid, which transports it to homes and businesses.

The retail market consists of all the companies that sell electricity to consumers, including British Gas and EDF Energy, which also offer businesses electricity comparison services.

Tariff Types for Businesses

There are three main types of tariff offered by energy companies: standard, fixed, and variable. The difference between these is that they have different terms and conditions, so it’s essential to understand what they mean before you sign up for one.

Standard Tariff

A standard tariff is the most common type of business electricity comparison service offered by energy suppliers.

It’s usually available as a default option when you sign up with an energy supplier and will automatically renew if you don’t choose another chance during your first billing cycle.

This means that unless you change your contract (i.e., through switching tariffs), you will continue paying the same rate for your energy each month until your contract expires or when you switch providers (whichever comes first).

Variable Tariff

A variable tariff fluctuates according to the energy market. Therefore, the rate you pay will change monthly depending on current market conditions, and these changes can be significant.

They make it much easier for you to keep track of your business electricity costs – but it also means that there’s a chance your prices could go up unexpectedly.

Fixed Tariff

A fixed tariff remains the same for the duration of its contract. This means that you don’t have to worry about price changes, but it also means that you won’t benefit from any potential reductions in rates as they fall over time.

The Energy Fuel Mix

The Energy Fuel Mix is the total amount of energy generated from different sources used to power homes and businesses in the UK.

It comprises electricity, natural gas, oil, and coal. In recent years, renewable energy sources like solar power and wind farms have become more popular, while nuclear energy has been phased out.

The Energy Fuel Mix for businesses differs depending on their business type. In addition, companies use other fuels in different ways, so there isn’t one standard fuel mix for all businesses.

For example, a small printing company can generate a lot of energy through solar panels on its roof. This means they won’t need much electricity or gas because they can rely on their resources.

However, this wouldn’t be possible if they were a large corporation with hundreds of employees in different locations across the country. So they would need more expensive sources like coal and oil instead.

Final Thoughts

Considering all the different factors, you may find yourself wondering how you can choose the right electricity company and utility plan.

Hopefully, this article has helped you better understand how to choose the right electricity supplier based on the five things you have to consider.

If you’re still unsure which option is best for you, don’t worry — finding the right deal is all about doing a little research and comparing options to see what fits best.


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