Energy For Large Businesses

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Energy For Large Businesses

Business energy bills are one the most significant expenses for large businesses, and reducing them is a priority. As well as reducing energy costs, large businesses in Britain are looking to become more energy efficient for financial and environmental purposes.

In this guide, we look at the definition of a “large business” and how these businesses can reduce costs.

How many kWh does a large business use?

A large business is defined in the energy sector as one of two things, these are:

  • If your business consumes more than 293,000 kWh of gas per year.
  • If your business consumes more than 100,000 kWh in electricity per year.

If your business fits within one of these categories, business energy suppliers will class you as a “large” business. Most suppliers will offer you bespoke energy rates, advise your business to become more energy-efficient and offer devices such as multi-site meters.

How can I save on energy rates as a large business?

There are many ways to save money on your energy rates as a large business. One of the simplest ways is to switch business energy suppliers to a lower tariff or become more mindful of energy consumption around the office.

Business Energy Audit

A business energy audit is recommended before signing a new contract as it helps you to understand your energy consumption. Not only can you act to reduce your energy bills immediately through “easy-wins”, but it will let you pick the energy deal that best suits your energy habits. You can use our in-house business energy audit checklist to start this process right now.

Compare business energy rates

Now that you have a clear idea of your business’s energy habits, use our business energy comparison tool to compare the latest business electricity prices and busienss gas rates to ensure you are not overpaying.

If your current business energy tariff ends in the next 12 months, most suppliers will allow you to secure lower rates in a renewal contract.

Energy-saving devices

A likely outcome from your energy audit is using energy-saving devices, as they’re an excellent strategy for large businesses looking to reduce their energy usage.

One of the most beneficial devices to consider is the energy timer. Energy timers are ideal for managing the power consumption of lighting, office equipment (such as printers and desktop PCs), and kitchen appliances.

By using these timers, you can ensure that equipment is not needlessly consuming energy overnight when your premises are likely unoccupied.

Businesses often experience substantial energy waste during ‘closed’ hours, which can have an adverse impact on both the environment and your finances.

💡Use our Appliance Cost Calculator to see how much each costs you!

Other energy efficiency devices to consider are:

  • LED bulbs.
  • Light sensors.
  • Smart thermostats.
  • Radiator boosters.
  • Smart plugs.
  • Energy-saving letterbox covers.
  • Eco showerheads.
  • Smart meters
  • Automatic radiator bleeders.

Energy education at the workplace

Education is often overlooked, even though it may be one of the most effective ways of reducing needless energy use. Adopting energy-saving habits like switching off lights or powering down computers instead of leaving them on standby will save you a lot in the long run.

Adjusting the heating schedule or implementing a timer can also lead to substantial savings on your annual business energy bill.

💡 Lighting can contribute as much as 40% of business energy use. Timed light switches and LED bulbs can significantly reduce this.

Go paperless

Decreasing the amount of paper used Becoming a paperless office decreases your energy output mainly as it removes the need for printers that take up a considerable amount of electricity and cost money to maintain and run daily.

What type of meters are there for large businesses?

These special types of meters are solely to record the consumption of large businesses to ensure they are being billed fairly and accurately.

Half hourly meters

Half hourly meters (also known as HH or 00) are electricity meters that send consumption data to your business electricity supplier every 30 minutes. This allows the supplier to bill you accurately for what you’ve consumed.

Older AMR (Advanced meters) also allow half-hourly metering and standard smart meters. If you have a demand of over 100kWh, you must implement half-hourly metering reading as a compulsory measure under P272.

To tell whether or not your business has a half-hourly meter installed, you can check if your MPAN (21-digit number) begins with a “00”.

You can find this on any electricity statement in a box marked ‘S.’ Half-hourly meters are sometimes called ’00 meters’ for this reason.

Businesses that use a half-hourly meter will have agreed on a “Maximum import capacity”. This figure is agreed with your local Distribution Network Operator (DNO). This allows them to ensure they have enough supply to meet your maximum import demands.

If you use over the maximum agreed amount, your business must pay an Excess Capacity Charge by the DNO.

This charge is based on what you’ve used over the agreed amount and will be charged through your current business energy supplier.

Multi-site meters

Multi-site energy meters (or multi-location meters) are a simple way for a large multi-site business to organise the billing and readings for each site.

It makes accurate billing easier and is significantly more time-efficient.

Multi-rate meters

A multi-rate meter offers various business electricity prices per kWh over a 24-hour period. Multi-rate business electricity tariffs allow you to use cheaper night-time electricity rates.

You will pay the standard rates during normal hours, but they will offer an “off-peak” rate that offers lower rates during weeknights and weekends.

Off-peak times vary depending on three factors, these are:

  • The meter your business has installed
  • Your business energy supplier
  • Property location

What is a P272?

P272 is a regulation enforced on 5th November 2015 requiring large businesses to have their energy usage recorded every half an hour.

Sites affected by P272 were switched from NHH metres (non-half-hourly) to HH (half-hourly meters). The reason for the change was so suppliers could bill more accurately.

P272 applies to businesses in profile classes 5-8, that is MPANs starting with 05, 06, 07 or 08.

How can a factory reduce its energy consumption?

Factories can consume vast amounts of energy in industrial processes. With wholesale energy prices soaring, controlling business energy overheads becomes more important. Here are a few steps factories can take to reduce energy consumption:

  • Optimise door sensors – Factories with cold room storage use automatic doors to ensure these areas are sealed. Reducing the close door delay using the timer settings will reduce the cold air wasted every time the door opens.
  • Replacing air conditioning systems – Modern air conditioning systems are significantly more efficient than older models. A quick cost-benefit analysis can determine whether it is worth replacing an older system earlier than planned to reduce wasted energy consumption.
  • Regular equipment maintenance – Using a planned maintenance cycle for electrical equipment will optimise performance and lifespan.

A formal business energy audit helps businesses of all sizes find ways to be more energy-efficient.

Will the Climate Change Levy affect your large business energy rates?

Most probably.

The Climate Change Levy (CCL) is an imposed tax on gas and electricity usage to promote the reduction in energy emissions. The CCL is only chargeable on kWh used.

Businesses that pay the standard rate of VAT (20%) are also charged the CCL – But there are exceptions. These are for businesses that do not meet the minim use.

If they don’t meet the minimum use, they will only be charged 5% VAT and not pay the Climate Change Levy charge.

The qualifying usage is as follows:

  • Electricity: this means using an average of less than 33 kWh per day or 1,000 kWh per month
  • Gas: this means using an average of fewer than 145 kWh per day or 4,397 kWh per month

The Climate Change Levy is designed such that all businesses except those only consuming small amounts of energy will contribute.

Looking to switch business gas suppliers?

Are you looking to switch your business gas supplier? If so, use our business gas comparison tool. Switching couldn’t be easier; switch today.

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Save money by using our business water comparison tool – switch business water suppliers today to save on your water supply tariffs.