What is the energy price cap?
Ofgem’s energy price cap for business energy deals is notably absent. Instead of imposing rate limits, the government has introduced the Energy Bills Discount Scheme, which aims to provide discounted rates for eligible non-domestic business energy contracts.
Our energy experts conduct a Business Energy Comparison from reputable UK energy providers, to offer you the most competitive fixed deals available for your business.
Will energy prices go down in 2023?
Predicting energy costs is challenging even under optimal circumstances, and the current market volatility has elevated the uncertainty, making it unfeasible to ascertain whether wholesale energy prices will decrease this year. While prices have exhibited fluctuations throughout the year, the predominant trend has been one of escalation.
Projections from Cornwall Insight, a renowned energy research and analysis firm, indicate that high energy costs might persist well into the upcoming year and potentially extend into 2024.
Effective from the 1st of April 2023, the Energy Bills Discount Scheme has taken over from the Energy Bill Relief Scheme. This new scheme endeavours to provide discounts on unit rates for all eligible business gas and business electricity plans.
However, the level of government support isn’t as ample as the previous energy bills support scheme was, given the government’s decision to trim funding from approximately £18 billion over six months to £5 billion spanning 12 months.
For a more comprehensive understanding, refer to our comprehensive guide on the Energy Bills Discount Scheme.
Should you fix your energy prices until 2024?
The UK government has announced the Energy Bill Relief Scheme will now be replaced with the Energy Bill Discount Scheme, a reduced scheme to help businesses and other non-domestic customers.
We recommend that you secure a fixed deal to protect your business against future price rises in 2024. Other than the Energy Bill Discount Scheme, there is very little help available for businesses struggling with their energy bills.
Whether you’re currently on a variable tariff or a fixed deal, Utility Bidder can help you find a better rate for your business. We can help you compare fixed deals and find the one that best meets your requirements.
Due to the volatility of the current energy industry, energy rates fluctuate daily, which is why it’s important to seek a professional business comparison service. We can alleviate the stress and handle the entire switching process for you.
Why are renewable energy prices high?
If you’re enrolled in a green energy plan that boasts 100% renewable sources, you might be perplexed by the surge in prices, even though no gas is utilized for its generation.
Despite renewable energy accounting for a substantial portion (45.5%) of the UK’s overall energy production during the initial three months of this year, the reliance on gas-powered plants for some electricity generation remains.
Even if you’re subscribed to a scheme that pledges 100% renewable energy, the cost of your electricity is established not based on the expenses associated with wind or solar generation, but by the cost attributed to the last energy source utilized to fulfil demand. As gas-powered stations are engaged to supplement electricity demand in the UK, the cost of gas-powered electricity sets the pricing for all electricity.
Therefore, when gas and electricity prices encounter abrupt spikes, it’s highly likely that gas and electricity prices will closely follow suit.
What if you can't afford your energy bills?
While reducing your energy consumption can contribute to some savings on your bills, the impact on the average annual bill is likely to be relatively minor when contrasted with the current energy expenditures.
Reaching out to your energy supplier and expressing your financial challenges can lead to the establishment of a new payment arrangement. In situations where consensus can’t be reached and you’re accustomed to direct debit customers, your provider might propose a transition from direct debit customers to a prepayment energy tariff only.
Additionally, it’s prudent to investigate your eligibility for the following government initiatives:
There could also be local grants accessible, prompting you to consult your local council for potential assistance.
What if you're moving to a new business premises?
When relocating your business, one of the two scenarios below will typically occur with your energy contract:
- Your contract will be transferred to your new premises.
- Your contract will be terminated, necessitating the establishment of a new contract at your new location.
When you commit to a business energy agreement, the flexibility to terminate it prematurely is often limited. Suppliers procure the precise energy quantity to cover the contract’s duration, making early termination potentially disadvantageous for them.
Should you opt to transfer your current energy arrangement to the new premises, your supplier will manage the transition, ensuring a smooth process. Your billing will commence from the day you begin operations at the new location.
Alternatively, should you decide to switch to a new deal with a different energy supplier then, you’ll need to address your final business energy bill payment or any refunds due if your account held a credit balance.
Switching your business energy supplier could save you money on your energy bills. Speak to our energy experts now to secure your business energy deal.
What happens if you run your business from home?
In the scenario where your small business operations are entirely home-based, you might not have transitioned to a dedicated business energy plan. Consequently, the energy price cap will directly impact you in either of the following manners:
- If you are enrolled in a standard variable rate tariff, your rates will rise in alignment with the Ofgem energy price cap.
- Your fixed deal from the supplier will incur price increases, potentially affecting your costs when switching energy suppliers in the future.
Running a business from home naturally implies higher energy consumption compared to working at commercial premises, especially during colder months.
The amount of gas and electricity utilized at home directly influences the magnitude of your average household energy bills. In contrast, if your business is conducted from dedicated premises (e.g., a salon or restaurant), the protective shield of an energy price cap doesn’t apply. While your workplace benefits from customized business gas and electricity arrangements, your commercial supplier might still revise rates during your upcoming renewal to offset increased expenses.
For those engaged in the restaurant or takeaway industry, our energy-saving tips guide page offers insights into energy bill savings strategies.
How to switch business energy suppliers with Utility Bidder
For the fastest and most straightforward approach to discovering optimal business energy agreements, get in touch with our business energy experts.
Simply provide us with your business name and postcode, and we will harness intelligent data and our expertise to swiftly identify the finest business gas and electricity tariffs tailored to your enterprise, all within a matter of minutes.
Our team of business energy professionals will then conduct a search for the best fixed deal, from our array of reputable energy providers across the UK. You can simply determine your preferred fixed deal then, leaving the rest to us.