Businesses are facing volatile electricity prices that pose a tough question: absorb the costs, or pass them on to customers?
Organisations and households are feeling the squeeze of rising bills and there’s no easy solution.
But what if you could reduce your electricity costs in the first instance?
Whether you’re locked into a long contract, or up for renewal, we want to equip you to do right by your business.
In this guide, we explain seven key principles to help reduce your business electricity costs.
In this article:
The first step towards managing your electricity costs is to understand your current consumption, contract and priorities.
Check your annual electricity consumption, understand your usage patterns (where possible) and determine your business priorities, including risk appetite and any near-future expansion plans.
You should also understand individual elements of your bill and what you’re actually paying for.
Once you have an idea of your usage, you can begin to reduce it. This sounds obvious, but when was the last time your business made a proactive choice to cut usage?
There are lots of ways to do this, ranging from quick wins to longer-term solutions.
First steps could include introducing a shutdown procedure that involves switching off equipment and encouraging buy-in across your teams.
Identify equipment that is running unnecessarily or consuming energy without providing any business value. Unused equipment can quietly rack up bills.
Linked to reducing your usage, think about your daily schedule.
If your business functions as a ‘9-5’ operation, make sure your core energy usage falls within those hours. Lighting, air conditioning and other intensive systems should only operate when they’re needed. Smart controls can help.
Introduce shutdown procedures and encourage managers to introduce simple protocols to follow at the end of each day. Most equipment doesn’t need to be switched on while your employees are switched off at home.
Energy efficiency is about getting the same output from your business while using less energy, not lazily switching off essential machines and hoping for the best.
For example, LED lighting is far more efficient than traditional bulbs, while replacing old equipment with new, efficiency-friendly alternatives is generally good practice.
Audit heavy machinery processes to determine whether you can reduce speed, temperatures or other settings without reducing quality.
Small tweaks may seem unremarkable in the moment but watching them accumulate into tangible savings will feel rewarding.
Perform regular audits across equivalent periods. Annual or seasonal assessments work well.
Track both electricity consumption and costs. Comparing usage over time can help you assess efficiency improvements, while reviewing unit rates and standing charges helps you understand changes to your overall bill.
This step may not be suitable for every business, but it is certainly worth exploring whether your business can benefit from homegrown renewable energy.
Falling technology costs combined with increasing numbers of grants, schemes and tax reliefs could make solar panels and wind turbines more accessible to businesses than ever.
Unused roof space or land could be put to work for energy generation. Homegrown energy could help shield your business from volatile markets and reduce your unit rate.
Renewable energy can be a powerful business energy tool, especially if paired with battery storage and a time-of-day tariff.
This process can run alongside your electricity efficiency programme.
Using less electricity means your business will pay for fewer units of electricity, but finding a suitable contract could reduce that unit rate itself.
Of course, procurement shouldn’t simply revolve around headline prices.
The right contract depends on your consumption, budget, risk appetite and plans for the business. Consider the contract length, unit rates, standing charges, termination conditions and how much price certainty you need before deciding.
Business electricity is complex. We get it. We can support you.
Troo exists to help businesses make sense of their energy needs. We simplify information and help you make smart decisions that manage costs and lead to real change.
We are not here to sell you a quick fix. We're here to understand what matters to you, offer clear advice, and take ownership of the hard parts, so energy becomes one less thing to worry about.
Book a free energy health check today for practical advice on business electricity, gas and water procurement, renewable consultancy and our ongoing management services.