How Do Business Energy Contracts Differ From Domestic Contracts?
One of the key differences between business customers and domestic energy contracts is that businesses must pick a gas and electricity supplier for a set period. Domestic energy tariffs on the other hand tend to come in the shape of rolling energy tariffs and as such, there is no expiry date for domestic customers.
The supplier will continue to supply energy to domestic customers on their current tariff until the homeowner decides to switch or upgrade their domestic energy tariff.
Here are a handful of ways business energy and domestic tariffs differ:
Cheaper bulk energy
Business energy suppliers have the option to purchase business energy in bulk, which means the supply will last the entire contract duration. Domestic gas and electricity suppliers on the other hand will purchase energy month by month.
What does this mean? Business energy suppliers are privy to energy at a better rate, which the business owner is also able to benefit from. As we have mentioned, both VAT and surplus charges can increase business energy costs quite significantly, which is why it’s important to learn more about these additional costs first.
Longer & more complex contracts
The majority of modern-day businesses choose energy contracts that span a lengthy period - usually around five years. What does this mean? First and foremost, the price is often more competitive as the supplier can buy energy in bulk, thus lowering costs on a whole and making business energy cheaper.
One downside of this? It means the business owner is tied into the deal for a set amount of time, which is why it’s important for business customers to pick the best contract from the onset.
When you invest in business energy, you’re investing in a bespoke contract, designed to suit the needs of your company and staff. The cost of this contract will be a one-off fee that won’t (unlike domestic contracts) change throughout the year.
This gives business customers peace of mind when it comes to repayments, as there will be no proven fluctuations to deal with. To ensure you get the best energy tariff from the onset, visit https://www.businessenergyuk.com and request a quote within 60 seconds.
Wish to talk to an adviser? Call us on 0800 464 7677 and speak to one of our expert UK based business energy advisers.
No "cooling-off" period
Business energy contracts don’t tend to come with a cooling-off period. This means that when the contract is signed, no changes can be made. It also means commercial energy deals are privy to a set payment, rather than one that fluctuates, which often makes them cheaper than domestic energy on a whole.
For more information, read the electricity supply terms and conditions before making a decision on your business electricity to ensure you get the best business energy deals.
No contract termination
If you’re happy with your business electricity tariff, this will continue to roll over year on year without you having to lift a finger. It’s only if you wish to change your commercial energy tariff, that you will you need to terminate the contract when your tariff is up for renewal.
Higher VAT charges
VAT, or Value Added Tax, comes in the shape of a government tax, which is applied to all goods and services purchased or sold for consumption or use by individuals or businesses. In a nutshell, this means your commercial energy is privy to VAT, and as such, all companies are required to pay a percentage of VAT on business energy prices.
What Criteria Determines The Cost Of Business Energy?
When determining the cost of business energy there are many factors to take into consideration if you wish to source business energy cheaper, some of which we have listed below…
First and foremost, you’ll be asked to provide your business postcode, this will determine which commercial energy contracts are available in your area.
You’ll then be required to detail your business type, this includes the size and nature of your business. This will allow us to provide a bespoke quote suited to your exact needs.
Business energy bills tend to be cheaper than domestic energy tariffs as you’re tied in for the year at least. You may choose to take out a contract for longer, which can lower your business energy deal even further.
Understanding your business’ different energy demands is an important factor suppliers need to take into consideration as this will determine how much energy they purchase from the onset.
Business' credit score
This is an important factor commercial energy contract suppliers take into consideration. The better your business’ credit score, the more commercial energy deal options you will be privy to.
Which Energy Regulations Must Businesses Adhere To?
Grasping the ins and outs of business energy regulations in the UK can be challenging, to say the least, however, all companies investing in business energy must comply with these rules. There are numerous schemes and levies commercial customers will need to factor into consideration.
Factors to consider include:
- CCL or Climate Change Levy fluctuations
- MEES or Minimum Energy Efficiency Standards (this is something business landlords need to be aware of)
- CRC Energy Efficiency Scheme
- Updates to Ells or Energy Intensive Industries exceptions
- ESOS compliance checks
Compare The Best Energy Quotes At Business Energy UK
When it comes to sourcing or switching business suppliers, this can prove a time-consuming project, especially if you’re managing a larger company or this is your first time switching to a business tariff. Thankfully, we’re here to help. We not only help you change suppliers, but we also help you to source the best, bespoke deal.
For more information, speak to one of our energy-savvy team today. All you’ll need to provide is your business postcode, this will allow us to run an energy comparison. You’ll then be met with a range of quotes, all from trusted suppliers. We’ll talk you through the various options available, to ensure you pick an energy tariff that is perfectly suited to your business.
Once you’re up and running, our services don’t stop there, we’ll go above and beyond to oversee the entirety of the switch for you, and we’ll manage renewals to ensure you’re privy to the best deals year after year. It is that simple! What are you waiting for? Get in touch with us today.