If you own a microbusiness, you’ll probably be used to tight margins – which is why paying more than you need to on essentials like wages and utility bills is a definite no-no.
Luckily, you can cut the cost of overheads and avoid shelling out on big bills by simply switching your energy provider. The even better news, is that according to rules by industry regulator Ofgem, microbusinesses have more flexibility to switch provider compared to other small or medium businesses (SMEs).
If your business has fewer than ten employees and turns over less than €2 million (around £1.7 million*) then you’re classed as a microbusiness.
You can also qualify for a microbusiness energy contract if you use no more than 293,000kWh of gas, or 100,000 kWh of electricity each year – in terms of cost, this works out at roughly £10,000 - £12,000 per year for each fuel type (excluding VAT and the Climate Change Levy). If you’re not sure how much energy you use, your energy supplier should be able to help you.
If you run your business from home and about 50% of your energy use goes on powering your microbusiness, then you should investigate swapping your household energy plan for a business one. That’s because commercial energy prices for gas and electricity tend to be much lower than rates for domestic use.
When you work out how much of your household energy your business uses, bear in mind that you can’t include the cost of running appliances that are always switched on – such as your fridge or freezer.
As a microbusiness owner, you can tell your energy supplier that you want to switch at any point during your agreement. SMEs, on the other hand have to wait for a set notice period before telling suppliers that they’d like to change contract.
Rules brought in by Ofgem back in 2014, mean that if you’re on a fixed-term contract, energy providers must clearly show when your contract begins and ends, along with any notice periods – making it easier to see exactly when you should switch to avoid rolling over to pricy default energy plans.
If you’re worried about relying on estimated meter readings and eventually being hit with a huge energy bill, then you can relax. Ofgem, has also set out guidelines that mean energy suppliers can’t backdate bills more than 12 months. Of course – to avoid under or overpaying, you should always provide accurate readings so you only pay for what you use.
Switching your business energy provider is simple, quick, and hassle-free, just fill in your details for a quote or give our UK based experts a call on 0800 326 5517.
To find the best deal for you, we’ll listen to your business needs then search for quotes from all the top energy suppliers. We’ll even sort out all the nitty-gritty, like telling your old supplier and setting you up with your brand new one.
We’ve helped small businesses save an average of £970** a year on energy bills – so if you want to increase profit by reducing costs, contact us today and see how much you could save.
* Based on exchange rate as of 22 May 2018
** At least 10% of businesses who switched energy supplier for both gas & electricity with us in 2017 saved £970 or more.