Gas vs. Electric: Which is Cheaper?

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    Guide Author

    James Longley

    Managing Director

    min read
    Last Updated November 22, 2021

    It’s a constant battle choosing between gas and electric for your heating system. With so many different suppliers and tariffs available, it can be difficult to find the best option for your business. Is gas or electric cheaper? What’s the most affordable option for your business? If you’re not careful, you could end up paying much more than you need to for your business energy.

    In this guide, we compare electric vs. gas heating to give you a clearer idea of what represents good value for money, and which option is the best fit for your business.

    Gas vs. electric heating

    • Business gas: relies on a boiler to burn fuel and heat water. This water is then passed through radiators and pipes to heat the building.
    • Business electricity: uses separate appliances in each room to control the temperature of the building – like plug-in fans or electric heaters.

    Electric vs. gas heating for hot water

    • Electric water heaters: modern electric heaters are completely efficient, converting all of the energy that they consume into heat for the boiler. They maintain the water at a pre-set temperature by heating it sporadically to minimise energy wastage.
    • Gas water heaters: a conventional boiler uses up energy by keeping the water permanently warm, which means they are great at reheating water once the tank is empty, but they have ineffective heat retention – gas boilers can lose some of their heat through the roof or your ventilation system.

    Gas vs. electric cooking hobs

    This one is mostly down to personal preference – electric hobs are easier to clean, whereas it’s typically easier to control the temperature on a gas hob. You can have a gas hob if you use an electric heating system, just as long as you have a gas supply, and vice versa.

    Is gas cheaper than electric?

    But is gas or electric cheaper for businesses? Before we dive into the conclusion, let’s take a look at the average business gas and electricity bills in the UK.

    Average daily cost of gas and electric

    The average daily cost of gas and electric will depend on the size of your business. Below is a comparison of yearly gas vs. electric business energy bills.

    Average UK business gas usage

    • On average, UK microbusinesses use between 5,000-15,000 kWh of gas a year, while their average annual gas bills come in at around £400-820.
    • Small businesses come in a little higher at 15,000-30,000 kWh, with bills varying between £820-£1,458 a year.
    • Medium-sized business usage averages between 30,000-65,000 kWh per year, with annual bills coming in at £1,458-2,239.
    • Unsurprisingly, large businesses use the most gas of all, averaging around 75,000 kWh a year. Although larger companies typically benefit from the best priced gas rates and bespoke tariffs, they can still spend significant sums of money because of the sheer amount of gas they use.

    Find out what else can affect business gas prices – from supply and demand to regulatory pressure.

    Average UK business electricity usage

    • When it comes to electricity usage, microbusinesses average between 5,000-15,000 kWh per year, costing between £900-2,244.
    • Small companies average at around 15,000-25,000 kWh, while their bills typically come in at around £2,367-3,660.
    • Medium-sized enterprises typically use an average of 25,000-50,000 kWh, setting them back in the range of £3,774-7,234 each year.
    • At the top end of the scale, large businesses consume an average of 90,000 kWh of electricity every year. As with gas, while these larger companies tend to get the most competitive rates, they can end up paying significantly more overall for their electricity due to the scale of their usage.

    Most people will focus on the total cost stated on their energy bill, but it’s also useful to note the price per kWh. Suppliers will charge a certain amount per kWh of electricity that your business uses – meaning the more you consume, the more you pay. To calculate the kWh of any electrical device, simply multiply the wattage by the hours it is in use in one day – then divide this by 1,000. This number can then be multiplied by the number of days the appliance is in use to calculate how much electricity it uses. In the UK, there is no standard price for electricity per kWh.

    Find out more about the average business gas and electricity bills for UK businesses.

    So, is gas cheaper than electric? Going by these figures, gas is the lower cost option. However, there are other factors to consider – including energy efficiency and the VAT that is applied on top of business energy. If you’re struggling to find the best priced solution for your business, start comparing your options with utility brokers. Utility Bidder acts as an intermediary between you and the commercial utility suppliers to find the best possible priced tariff for your business.

    Is your electricity bill too high? Do you want to cut costs on your business gas? Get in touch with us today. We’ll save you time and money – with a commitment to find you the best price.

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    Choose your business address

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    Are you comparing for a business or home?

    Business

    Home


    Go Back
    Select Utility
    Now please select a utility I want to get prices for...
    Gas
    Electric
    Gas & Electric
    Water
    Go Back
    Next
    Please enter your business gas information
    How much do you spend & how often?

    An estimate is fine if you don't have a bill to hand

    Go Back
    Get Prices

    Let’s save time, can we automatically gather meter information?

    ? What does this mean?
    To get your quotes at lightening speed we need several key pieces of information which can all be found on your electricity bill. But by simply ticking this box, we can search ‘industry held data’ to get your meter number, electricity consumption and current energy supplier. This means that we can get you quick quotes without asking you to dig out all of your paperwork. This is personal data therefore we need you to allow us to access this information.
    Go Back

    Do you know your electric meter number?

    Does your meter number end in any of the following?

    Go Back
    Enter meter number
    I don’t know
    Please enter your business electricity information
    How much do you spend & how often?

    An estimate is fine if you don't have a bill to hand

    Start date for a new contract?
    Get Prices
    Please enter your water information
    How much do you spend & how often?

    An estimate is fine if you don't have a bill to hand

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      Enter your details below to get quotes We’ve helped over 90,000 businesses