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Reducing business energy prices

5th September 2018 - Business & Marketing
Reducing business energy prices

According to some studies, the average business in Britain spends around £4,000 annually on energy costs — which can be financially damaging.  Becoming energy aware (and energy smart) can not only help businesses boost their bottom line, it can also dramatically reduce their carbon footprint – making for a more profitable, greener company all round.

UK energy spend

In the last seven years, energy bills have soared by 100%+ as businesses continue to change their reasons of use. For most SMEs, gas and electricity charges now make up a considerable chunk of their monthly outgoings – taking a hefty portion of their profits. The majority of UK businesses are using between 15,000 and 25,000 kWh of power per year, but annual consumption figures for large business and industry can reach in excess of 250,000 kWh.

But how will this have an impact on bills?  The latest data shows that businesses in the UK are spending an average of £3,061 on their annual electricity bills, and an additional £856 a year on gas. Small businesses in particular fare slightly better – but with the average electricity bill for an SME reaching £2,958 (and that’s before putting business mains gas into the equation), it’s still a considerable outlay.

Reducing energy costs

One common goal that businesses around the country have is to bring down external costs in a way that does not have a profound impact on their overall operations — and there are plenty of ways to do so. Business gas supplier Flogas Energy shares some expert tips on how companies can slash their energy costs:

1. Energy awareness

If you want to reduce costs around energy, you need to know how much you are using and how much it is costing you. The average unit prices in the UK are currently 14.36p per kWh for electricity and 4.25p per kWh for gas, with standing charges on top of this. Finding out your business’s annual usage figures – and knowing when your contract is due to come to an end – means you’re well equipped to accurately compare your current supplier’s prices with others on the market.

2. Look into price comparisons

Comparisons are extremely important for your business if you’re looking for a cheaper deal. Ahead of your contract ending, it’s worth finding out how much switching could save you. And, whether you use a broker, online search or go direct, make sure you don’t limit yourself to the Big Six. Switching to a smaller business energy supplier could mean significantly lower bills, and benefits like better customer service.

3. Review your current contract

It’s important to make sure that you have a contract that suits your business which offers what you need at a reasonable price. For example, an extended fixed-term contract could help protect you against future price rises, giving some valuable peace of mind and making budgeting easier. Or there might be an additional discount on offer if you opt for a Direct Debit payment plan.

4. Install a smart meter

Think smart by installing a smart meter on your premises. That way you’ll know exactly how much your business energy supply is costing you day-to-day – and because you only pay for what you use, there’s no need for estimated billing or meter readings. As well as saving on monthly charges, it can also help you wise up to your company energy use and make better decisions on where you might be able to curb your consumption. Energy management software can also help provide useful insight for larger businesses.

5. Monitor and adapt your usage

If you find that currently you use more energy than you probably need to, it may be time to adjust your usage for the better. It could be as simple as making sure computers are switched off outside of office hours, or putting your lights on a timer, but encouraging employees to find more efficient ways of working is a great place to start. Some companies even introduce incentive schemes to help foster better habits, offering staff tangible rewards for greener behaviour.

6. Make investments to equal savings

Keep long-term energy performance in mind when investing in equipment for your company, for example opt for energy efficient, A-rated appliances. It’s important to think long term around energy and only use equipment that has your best interests at heart. While this approach might come with a heftier price tag in the first instance, any piece of kit that helps save energy on your everyday operations will pay for itself and more in the long run.

 

 

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