Business Magazine

How to Cut Your Energy Costs

Posted on the 03 January 2019 by Mountain Publishing @mountainpublish

Cutting costs in business is essential if you want to keep turning a profit. According to independent consultancy, Smarter Business, the average medium-sized business in the UK forks out more than £4,000 a year on electricity and around £1,500 a year on gas, while small businesses pay approximately £2,500 annually for their electricity and nearly £1,000 for their gas. Clearly, now is the time for companies to take a look at their gas and electric usage and find quick and easy ways to slash their bills.

Being proactive when it comes to green energy practices will help the environment and save you cash. But how can businesses achieve smarter energy awareness?

What are companies in the UK spending on energy?

Energy bills have risen 100% in the last seven years, according to reports. 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.

So, can owners and employees be doing something to bring down costs? 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.

Actions you can take

Don’t fear, there are ways you can lower energy prices to make your business more profitable. Flogas, a leading business gas supplier, provides the below advice on slashing energy costs:

1. Check your current contract

Ask around to find out which provider offers the best deal. 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.

2. Compare different prices

Can switching save you money? Whether you use a broker, online search or go direct, make sure you don’t limit yourself to the ‘Big Six’ energy companies. Switching to a smaller business energy supplier could mean significantly lower bills, as well as benefits like better customer service.

3. Clue up on energy use

How will you know if you’re getting a good deal if you don’t read up on the subject. 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.

4. Get a smart meter

Smart meters are used all over the UK in 2018. You’ll know exactly how much your business energy supply is costing you day-to-day. Plus, 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, smart meters 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. Invest

The appliances and machines you use at your business will also drive up prices, if they’re not energy-efficient. 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.

6. Change how you view energy consumption

You need to adopt a different attitude if you’re going to cut down on energy use. 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 behavior.

*Statistics from BusinessEnergy.com and SmarterBusiness.co.uk


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