How Startup Owners Can Reduce Their Business Electricity Costs

Why Startup Owners Need to Reduce Their Business Electricity Costs

As a startup owner, you know how challenging it is to run a successful business in a competitive and uncertain market. You have to deal with various issues, such as finding customers, raising funds, hiring talent, and developing products or services. You also have to manage your expenses and keep your cash flow positive.

One of the major expenses that you have to pay attention to is your business electricity costs. Electricity is essential for powering your office equipment, lighting, heating, cooling, and communication systems. However, electricity can also be very expensive, especially in the UK if you do some electricity comparison, where the average electricity price for small businesses was 15.37 pence per kWh in 2021.

According to a report by British Gas Business, the average annual electricity bill for a small business in the UK was £2,528 in 2019. This means that if you use the same amount of electricity as the average small business, you would spend about £210 per month on your electricity bills.

However, electricity prices are expected to increase in the future due to various factors, such as the rising demand for electricity, the phasing out of coal-fired power plants, the impact of Brexit, and the effects of climate change. According to a forecast by Cornwall Insight Business, the average electricity price for small businesses could reach 18.22 pence per kWh by 2023. This means that if you use the same amount of electricity as the average small business, you would spend about £253 per month on your electricity bills.

Therefore, it is crucial for startup owners to reduce their business electricity costs as much as possible. Not only will this help you save money and improve your profitability, but it will also help you reduce your environmental impact and enhance your brand image.

How to Audit Your Current Electricity Usage and Identify Areas for Improvement

The first step to reduce your business electricity costs is to audit your current electricity usage and identify areas for improvement. An audit is a process of measuring and analysing how much electricity you use and where you use it. By doing an audit, you can find out how efficient or wasteful your electricity consumption is and what actions you can take to improve it.

There are two main ways to do an audit for your startup:

• Using a smart meter: A smart meter is a device that records and displays your real-time electricity usage and cost. It also sends this information to your supplier automatically, eliminating the need for manual meter readings and estimated bills. By using a smart meter, you can monitor and manage your electricity consumption more effectively and accurately. You can also access your data online or via an app and get personalised feedback and tips on how to save energy.
• Hiring an energy consultant: An energy consultant is a professional who can visit your premises and conduct a thorough assessment of your electricity usage and efficiency. They can also provide you with a detailed report and recommendations on how to reduce your electricity costs and carbon emissions. They can also help you implement the suggested measures and monitor their results.

By doing an audit for your startup, you can identify the following areas for improvement:

• The type and number of appliances and equipment you use: You should check if you have any outdated or inefficient appliances or equipment that consume more electricity than necessary. You should also check if you have any unnecessary or redundant appliances or equipment that you do not use or need.
• The usage patterns and behaviours of your appliances and equipment: You should check how often and when you use your appliances and equipment. You should also check if you turn them off or put them on standby when not in use or during non-working hours.
• The lighting system of your premises: You should check the type and number of light bulbs you use. You should also check the brightness and colour temperature of your light bulbs. You should also check if you use natural light or artificial light during daytime.
• The heating and cooling system of your premises: You should check the type and efficiency of your heating and cooling system. You should also check the temperature settings and controls of your heating and cooling system. You should also check if you use insulation or ventilation to maintain a comfortable indoor environment.

By doing an audit for your startup, you can find out how much electricity you use per month or per year and how much money you spend on it. You can also compare your usage and cost with other similar startups or industry benchmarks. This will help you set realistic goals and targets for reducing your business electricity costs.

How to Implement Energy-Saving Measures and Practices in Your Startup

The second step to reduce your business electricity costs is to implement energy-saving measures and practices in your startup. Energy-saving measures and practices are actions that you and your employees can take to reduce your electricity consumption and waste. By doing so, you can save money on your bills, reduce your environmental impact, and improve your productivity and performance.

There are many energy-saving measures and practices that you can implement in your startup, such as:

1. Switching to LED lighting: LED lights use up to 80% less energy than traditional incandescent or halogen bulbs. They also last longer, produce less heat, and provide better quality light. By switching to LED lighting, you could save up to £240 per year on your business electricity bills.
2. Using energy-efficient appliances and equipment: Energy-efficient appliances and equipment are devices that use less energy than standard ones to perform the same functions. They also have a lower environmental impact and a longer lifespan. By using energy-efficient appliances and equipment, such as computers, printers, refrigerators, and air conditioners, you could save up to 30% on your business electricity bills.
3. Implementing energy-saving behaviours: Energy-saving behaviours are actions that you and your employees can take to reduce your electricity consumption and waste. They include turning off lights and appliances when not in use, adjusting the thermostat and ventilation settings, using natural light and ventilation, and avoiding overloading sockets and extension cords. By implementing energy-saving behaviours, you could save up to 20% on your business electricity bills.

By implementing energy-saving measures and practices in your startup, you could save up to £1,000 per year on your business electricity bills.

How to Choose an Electricity Supplier that Offers Competitive Rates and Green Options

The third step to reduce your business electricity costs is to choose an electricity supplier that offers competitive rates and green options. An electricity supplier is a company that provides you with electricity for your premises. You can choose from different suppliers that offer different prices and plans for your electricity needs.

Unlike domestic customers, who can switch their electricity supplier every year, business customers have to wait until their contract expires before they can switch. This means that you may be stuck with a supplier that charges you more than the market rate or does not offer you the best service.

Therefore, it is important to shop around and compare different electricity suppliers before you sign a new contract or renew your existing one. You can use online comparison tools, such as Business Energy or uSwitch, to compare electricity prices and plans from various suppliers. You can also contact suppliers directly or use a broker or consultant to help you negotiate a better deal.

Alternatively, you can visit British Business Energy which is a website that provides you with useful information and tips on how to save money on your business electricity bills. You can also get free quotes from different suppliers and find the best deal for your startup.

When choosing an electricity supplier for your startup, you should consider the following factors:

• The unit rate: This is the price you pay per kWh of electricity you use. You should look for a supplier that offers you a low and fixed unit rate that does not change with market fluctuations.
• The standing charge: This is a fixed daily or monthly fee that covers the cost of maintaining the network and supplying electricity to your premises. You should look for a supplier that offers you a low or zero standing charge.
• The contract length: This is the duration of your agreement with the supplier. You should look for a supplier that offers you a flexible contract length that suits your business needs and allows you to switch easily if you find a better deal elsewhere.
• The customer service: This is the quality of service and support you receive from the supplier. You should look for a supplier that has a good reputation, responds quickly to your queries and complaints, and provides you with clear and accurate billing information.
• The green options: These are the options that allow you to use renewable or low-carbon electricity for your premises. You should look for a supplier that offers you green tariffs or certificates that guarantee that the electricity you use is matched by an equivalent amount of renewable or low-carbon electricity generated elsewhere. You should also look for a supplier that offers you incentives or discounts for generating or using renewable or low-carbon electricity.

By choosing an electricity supplier that offers competitive rates and green options for your startup, you could save up to £500 per year on your business electricity bills.