Business energy guides
Everything you need to understand your bill, your contract and your options before you switch.
Business energy contract types
Fixed-rate tariffs
Your unit rate and standing charge are locked in for the contract term, usually 1–5 years. Your bill still moves with usage, but the price per kWh does not.
Variable-rate tariffs
Rates track the wholesale market, so they can fall as well as rise. There is normally no fixed term, with around 30 days' notice to leave.
Green energy tariffs
Electricity backed by renewable generation certificates, and gas offset or backed by biomethane. Increasingly priced close to standard tariffs.
Deemed rates
The default rates you are put on when you move into a premises without agreeing a contract. They are typically the most expensive rates available.
Rollover contracts
Applied automatically if you do not agree a new deal before your contract ends. For micro-businesses a rollover cannot exceed 12 months.
Out-of-contract rates
Charged after a contract ends when no new deal is in place. Usually far higher than a negotiated fixed rate.
Half-hourly (HH) contracts
Mandatory for larger sites with a maximum demand over 100 kW. Meters send readings every 30 minutes and pricing is built from your actual load profile.
Multi-site contracts
One agreement covering several premises, usually with aligned end dates and a single consolidated bill.
Business vs domestic energy
Business rates are quoted individually for your meter rather than published as a standard price list, and there is no price cap on business supply.
Business contracts are fixed for a term. You can normally only agree new rates inside your switching window, which opens up to six months before the end date.
There is no cooling-off period once a business contract is agreed, and business bills carry the Climate Change Levy plus VAT at 20% for most sites.
Dual fuel is usually two separate contracts rather than one combined deal, though many suppliers will quote for both.
Glossary
- MPAN
- Meter Point Administration Number — the 13-digit number identifying your electricity supply point, found on your bill.
- MPRN
- Meter Point Reference Number — the number identifying your gas supply point.
- Standing charge
- A fixed daily charge covering network and metering costs, payable even if you use no energy.
- Unit rate
- The price you pay for each kilowatt hour (kWh) of energy used.
- Climate Change Levy (CCL)
- A government environmental tax added to business energy bills per kWh supplied.
- VAT on business energy
- Charged at 20% for most businesses, reduced to 5% for low usage or for charitable and residential use.
- Switching window
- The period before your contract ends, usually up to six months, when you can agree new rates.
- Ofgem
- The regulator for Great Britain's gas and electricity markets.
- Fuel mix
- A supplier's published breakdown of the generation sources behind the electricity it supplies.
- Agreed capacity
- The maximum electrical capacity reserved for your site; exceeding it triggers excess capacity charges.
- Load factor
- How evenly your site uses energy across the day; a higher load factor usually attracts better rates.
- Letter of Authority
- A document allowing a broker to request contract and usage information from your supplier on your behalf.
Frequently asked questions
Why should I switch business energy supplier?
Energy is often one of the largest controllable overheads for a small business. Renewal and out-of-contract rates are usually well above the best available prices, so comparing at renewal can save hundreds or thousands of pounds a year.
How long does a business energy switch take?
Agreeing a deal takes minutes. The switch itself typically completes in two to six weeks, depending on your current contract end date and whether an objection is raised for outstanding balances.
Will my supply be interrupted when I switch?
No. The physical supply is unchanged — only the company billing you changes. There is no need for an engineer visit or new equipment.
When can I switch?
You can normally agree new rates during your switching window, which usually opens up to six months before your contract ends. Outside that window you may face termination fees.
Can I get a dual-fuel business energy deal?
Many suppliers quote for both electricity and gas, but they are usually separate contracts. Aligning end dates makes future renewals simpler.
Is there a cooling-off period for business energy contracts?
Unlike household energy, business contracts generally have no cooling-off period once verbally or electronically agreed, so check the terms before confirming.
How is business energy different from domestic energy?
Business rates are quoted individually based on your meter, location, usage and credit profile rather than published price lists. Contracts are fixed for a term, VAT is usually 20%, and the Climate Change Levy applies.
Can I switch if I have a debt with my current supplier?
Your existing supplier can object to a switch while a balance is outstanding. Clearing the debt or agreeing a payment plan usually removes the objection.