A guide to assist you to understand your business electricity

Every business needs to use electricity to run, but it can be tricky to get the best energy deal for your business. As a result, this can leave your business paying for unnecessary high energy bills. The good news is that you can seek the services of Utility Bidder to help you compare energy suppliers. 

Remember that there are several things you need to know to successfully compare energy suppliers yourself. These include the types of energy contracts available on the market, the types of energy suppliers, and the length of time it takes to switch the energy suppliers. This article is a guide to assist you to understand your business electricity. 

Understanding business electricity

The electricity that your energy supplies to your business premises is called business electricity. Remember that business electricity differs from domestic electricity. This is because the tariffs on business electricity are designed to align with the energy demands of business consumers. 

It can be confusing to understand your business electricity contract, though it’s crucial to understand some key terms that are included in the contract. A business electricity contract has your billing period which you can negotiate with your energy supplier while setting up your contract. This billing period refers to the time between each electricity bill. For a smaller business, it makes sense to have a shorter billing period so that you can easily check your spending on energy.

The unit rate on the electricity contract refers to the price you have to pay for each kilowatt-hour of electricity the business uses. When comparing energy suppliers, make sure that the unit rate is low. This is one area where energy suppliers tend to have significant differences because the unit rate can depend on your business situation. 

An electricity contract also has a standing charge which is a daily fixed price that is included in your electricity bill. This charge covers the maintenance of your electricity meter

There is also an agreed supply capacity for high electricity consumers, which is an agreed maximum demand of energy usage at any point during the billing period where the electricity supplier can determine whether or not you are exceeding your agreement. Ideally, if the energy supplier determines that you are using more than the agreed capacity, they can decide to overload the system to cause a power cut. 

Alternatively, the electricity supplier can hand you expensive excess charges. In some cases, if your electricity demand fails to reach the agreed maximum demand, then you can be paying more money on an energy tariff that is not suitable for your business.

Quite often, a business electricity contract is designed to meet the needs of your business rather than choosing any energy tariff. There are a couple of factors that can determine the energy deal you get. This includes your business credit profile and energy usage. Because electricity quotes can be customized, it can sometimes be hard to compare electricity tariffs because you may have to approach each electricity supplier individually.

Keep in mind that you can find several types of electricity tariffs out there, though business electricity contracts usually tend to be longer. You can get a better electricity deal because you can purchase it in bulk, but you can’t look for another electricity deal until your energy contract is in the renewal window.

Also, a business contract doesn’t usually have a cooling-off window. This means that you can’t get out of the contract once you have signed it. Therefore, you need to understand what you’re getting into before you sign an energy contract.

When your electricity contract approaches its end, your supplier can offer you a renewal time during which they can give you various options. Remember that you can refuse to accept these offers so that you can look for more competitive energy deals elsewhere as a new customer.

If you decide to find another electricity supplier, then the current electricity supplier can send you a final electricity bill that is based on the current tariff. You may also be asked to give your electricity supplier a final meter reading to make sure the bill is accurate. 

An electricity meter

No doubt, the type of your meter can make a significant difference when it comes to saving money and wasting it. The best way you can determine the type of meter you have is to check the MPAN on your electricity bill. The MPAN can be split into two lines, which have a top line that starts with two numbers. These numbers stand for a different meter type. 

There is a standard meter which was a common type of electricity meter before the arrival of the smart meter. A standard meter tends to have just a single rate and measurement period. This is the easiest electricity meter to read.

Then there is a two-rate meter which can be a bit complicated. These dual rate meters provide two different unit rates, but this depends on where your electricity usage peaks and the time of day. For instance, an Economy 7 meter can charge a higher price during your active hours and a lower price during the off-peak hours. In most cases, the off-peak period can be from 11 pm to 8 am. There is also what is called an evening and weekend electricity meter with rates that vary depending on both day and time.  

Another type of electricity meter is called the three-rate meter. This meter is usually called the evening, weekend, and night electricity meter. This meter provides the cheapest rates during the evening and weekend, and the most expensive rates are the daily rates. The time can vary between electricity suppliers, though this electricity meter is suitable for businesses like bars and nightclubs that use their energy during the cheaper time. 

Lastly, there are smart meters that are also called half-hourly meters. A smart meter is quickly becoming popular and compulsory, especially for large businesses. The good thing about a smart meter is that it sends more accurate readings of the energy usage straight to your electricity supplier. As a result, your electricity supplier can send you the correct electricity bills.

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