Business Electricity

Business electricity is the power used by commercial premises. It can cover everything from lighting, laptops and tills to refrigeration, machinery, security systems, electric heating, air conditioning and production equipment.

For some businesses, electricity is a fairly predictable monthly cost. For others, especially those using refrigeration, machinery, data servers or long opening hours, it can be one of the most important bills to manage.

Unlike domestic electricity, business electricity is usually priced around your organisation’s usage, location, meter type and contract terms. That means two businesses in the same town can be offered different rates, even if they appear similar on the surface.

Comparing business electricity quotes can help you understand what you are currently paying, what alternatives may be available and whether your contract still suits how your business operates.

How business electricity works

A business electricity contract usually includes two main charges: a unit rate and a standing charge.

The unit rate is the price you pay for each kilowatt hour, or kWh, of electricity used. The more electricity your business uses, the more important this rate becomes.

The standing charge is a fixed daily amount for keeping your premises connected to the electricity network. You pay it even if your business uses very little electricity that day.

Your bill may also include VAT, Climate Change Levy and other costs linked to network charges, metering, supplier costs or broker fees.

What affects business electricity prices?

Business electricity prices can vary widely. The main factors include:

Annual usage: Higher usage usually means a higher total bill, even if the unit rate is competitive

Meter type: Smart, advanced and half-hourly meters can affect how your usage is measured and priced

Location: Network charges can vary depending on where your premises are based

Contract length: Longer contracts may offer certainty, while shorter contracts may provide flexibility

Usage pattern: Businesses using energy at peak times may be priced differently from those with flatter usage

Market conditions: Wholesale electricity costs can influence new quotes

Credit and business profile: Some suppliers may assess your trading history or payment risk

The lowest unit rate is not always the best deal. For example, a business with low usage may be more affected by a high standing charge than by a small difference in the unit rate.

What is an MPAN?

An MPAN, or Meter Point Administration Number, identifies your electricity supply. It is sometimes called a supply number.

Your MPAN is not the same as your meter serial number. It tells suppliers which electricity supply point they are quoting for, so it is useful to have it ready when comparing quotes.

You can usually find your MPAN on your business electricity bill.

What information do you need to compare business electricity?

You will normally get more accurate quotes if you have a recent bill available. Useful details include:

• Business name and address
• Postcode
• Current supplier
• Contract end date
• Annual electricity usage
• Current unit rate
• Current standing charge
• MPAN
• Meter type
• Payment method

If your business has recently changed how it operates, for example by adding new equipment or reducing office hours, your old annual usage may not fully reflect your current needs.

Fixed vs variable business electricity

Many businesses choose a fixed-rate electricity contract because it gives more certainty over the unit rate for a set period. Your bill can still change if you use more or less electricity, but the agreed unit rate is usually fixed for the contract term.

A variable tariff can move up or down. This may offer flexibility, but it can also make costs harder to predict.

How to compare business electricity quotes

Before agreeing a new contract, check:

• The unit rate
• The daily standing charge
• Estimated annual cost
• Contract start and end dates
• Renewal rules
• Exit fees
• Whether prices are fully fixed
• Whether broker fees are included
• Payment terms
• Supplier support and billing options

It is worth comparing the total estimated cost rather than focusing only on the headline unit rate.

When should you compare business electricity?

A good time to compare is before your current contract ends. Waiting until the last minute can make it harder to review your options properly.

You should also review your electricity contract if:

• Your business has moved premises
• Your usage has changed significantly
• You have added energy-intensive equipment
• Your fixed contract is ending
• You are on deemed or out-of-contract rates
• Your supplier has offered a renewal quote
• Your business has become more seasonal or hybrid

How to reduce business electricity costs

Switching supplier is not the only way to manage your bill. You may also be able to reduce usage by:

• Installing LED lighting
• Using timers and sensors
• Switching off unused equipment
• Maintaining refrigeration or cooling systems
• Reviewing heating and air conditioning settings
• Checking out-of-hours electricity use
• Submitting regular meter readings
• Reviewing older equipment

Small changes can make a difference when applied consistently.