Getting to grips with your energy bills is important if you want to know exactly how much your business is paying for its gas and electricity, and to ensure you’re on the best deal.
But as you may well have experienced already, energy bills and the amount of information displayed on them can be very confusing, so here we explain how your business energy bill is broken down to help you make sense of how it works.
What is included on your business energy bill?
How your energy bill is structured will depend on your supplier, but the key information it contains will be the same. This means your energy bill should include the following:
- Bill date and billing period Your bill will show both the date the bill was issued, as well as the period of energy usage you’re being charged for
- Account number Used by your supplier for identification purposes
- VAT number If your business is VAT registered
- Name of your tariff Stating both the name of your electricity plan and your gas plan – this will be the same if you are on a dual tariff, where both your gas and electricity come from the same supplier
- Account balance brought forward If you have any balance outstanding from previous bills
- Your electricity and gas usage Your energy consumption in kilowatt hours (kWh). Your bill should also state whether this is based on an accurate reading or an estimate
- Your standing charge The rate you pay each day for keeping your business property connected to the energy network
- VAT charges The amount of VAT that’s been added
- Total amount due How much you are due to pay in total, factoring in energy usage, your standing charge, VAT and any amount leftover from a previous bill
- Your payment due date The date by which you need to have paid your bill
- MPAN/MPRN number Unique reference numbers used by your supplier to identify both your property and energy meters
- Early exit fees Your bill should state whether there is a fee for cancelling your gas and/or electricity contract early.
What charges are included in business energy bills?
The two main costs that make up your energy bill are the unit cost (the amount you pay for each unit of gas or electricity used, measured in kWh) and the standing charge.
However, there are a number of other costs that contribute the amount you pay overall. These include:
Business energy wholesale costs
The wholesale cost is the amount the supplier pays to buy energy in bulk before selling it on to customers. You won’t see the wholesale cost on your bill, but it makes up part of your unit rate.
Unless you’re on a fixed rate tariff (where you pay an agreed rate for each unit of energy you use over a set term), your energy bills will usually rise when wholesale costs do.
Transmission Use of System charges (TNUoS)
This covers the cost of maintaining and upgrading the National Grid. It is usually included in the standing charge.
Paying for Distribution Use of System (DUoS)
Distribution Network Operators (DNO) are licensed by Ofgem and distribute electricity in your area. The DUoS charge covers the costs incurred by your DNO and will vary depending on the type of contract you have, your meter type, your location and time of use.
Climate Change Levy
The Climate Change Levy (CCL) was introduced by the government in an effort to encourage businesses to become more energy efficient in how they operate and to reduce their carbon emissions. The cost is charged per unit of energy and will be factored into your overall energy bill. You can find out more about the CCL, including which businesses are exempt, in our guide
Value Added Tax (VAT)
Most businesses are charged VAT at a rate of 20% on gas and electricity and this will automatically be added to your energy bill. However, some businesses may be eligible to pay a reduced rate of 5% – you can find out more in our guide.
How can I pay my business energy bill?
There are several ways to pay your business energy bill, including:
Direct debit
Many suppliers offer a discount if you choose to pay your energy bills by monthly or quarterly direct debit. However, it’s important to regularly check you are paying the correct amount and that you are not building up either too much credit or debt on your account as the months go by.
Keep in mind you are likely to use more energy in the winter so any credit built up in the summer months could help to cover your increased use.
BACS or bank transfer
With this option you can wait until your energy supplier sends you your bill and then make your payment by BACS or online bank transfer. The advantage is that you know exactly how much you’re paying each time. The disadvantage is that you need to remember to make the payment.
Cheque or giro
Some suppliers still allow customers to pay for their energy bills by posting a cheque, but you’ll need to remember to allow time for your cheque to arrive to avoid paying a late fee.
Alternatively, your energy bill may have a giro bank slip attached which you can take to your local Post Office to make the payment.
How can I reduce my business energy bills?
One of the easiest ways to reduce your business energy bills is to switch to a cheaper tariff as soon as your existing contract comes to an end.
Your energy supplier will contact you once your contract enters its ‘renewal’ window and it’s at that point you should start shopping around and comparing tariffs – if you don’t, you’ll be moved on to your supplier’s expensive ‘out-of-contract’ rate.
Other simple steps to reduce bills include shutting down office equipment when not in use, upgrading from conventional lighting to LED technology, fully insulating your business premises, and getting a smart meter installed. Smart meters can help you work out when your business uses the most energy and ensure your bills are accurate.
Read our guide to discover more about saving money on business energy bills
What charges are included in business energy bills?
The two main costs that make up your energy bill are the unit cost (the amount you pay for each unit of gas or electricity used, measured in kWh) and the standing charge.
However, there are a number of other costs that contribute the amount you pay overall. These include:
Business energy wholesale costs
The wholesale cost is the amount the supplier pays to buy energy in bulk before selling it on to customers. You won’t see the wholesale cost on your bill, but it makes up part of your unit rate.
Unless you’re on a fixed rate tariff (where you pay an agreed rate for each unit of energy you use over a set term), your energy bills will usually rise when wholesale costs do.
Transmission Use of System charges (TNUoS)
This covers the cost of maintaining and upgrading the National Grid. It is usually included in the standing charge.
Paying for Distribution Use of System (DUoS)
Distribution Network Operators (DNO) are licensed by Ofgem and distribute electricity in your area. The DUoS charge covers the costs incurred by your DNO and will vary depending on the type of contract you have, your meter type, your location and time of use.
Climate Change Levy
The Climate Change Levy (CCL) was introduced by the government in an effort to encourage businesses to become more energy efficient in how they operate and to reduce their carbon emissions. The cost is charged per unit of energy and will be factored into your overall energy bill. You can find out more about the CCL, including which businesses are exempt, in our guide
Value Added Tax (VAT)
Most businesses are charged VAT at a rate of 20% on gas and electricity and this will automatically be added to your energy bill. However, some businesses may be eligible to pay a reduced rate of 5% – you can find out more in our guide.
How can I pay my business energy bill?
There are several ways to pay your business energy bill, including:
Direct debit
Many suppliers offer a discount if you choose to pay your energy bills by monthly or quarterly direct debit. However, it’s important to regularly check you are paying the correct amount and that you are not building up either too much credit or debt on your account as the months go by.
Keep in mind you are likely to use more energy in the winter so any credit built up in the summer months could help to cover your increased use.
BACS or bank transfer
With this option you can wait until your energy supplier sends you your bill and then make your payment by BACS or online bank transfer. The advantage is that you know exactly how much you’re paying each time. The disadvantage is that you need to remember to make the payment.
Cheque or giro
Some suppliers still allow customers to pay for their energy bills by posting a cheque, but you’ll need to remember to allow time for your cheque to arrive to avoid paying a late fee.
Alternatively, your energy bill may have a giro bank slip attached which you can take to your local Post Office to make the payment.
How can I reduce my business energy bills?
One of the easiest ways to reduce your business energy bills is to switch to a cheaper tariff as soon as your existing contract comes to an end.
Your energy supplier will contact you once your contract enters its ‘renewal’ window and it’s at that point you should start shopping around and comparing tariffs – if you don’t, you’ll be moved on to your supplier’s expensive ‘out-of-contract’ rate.
Other simple steps to reduce bills include shutting down office equipment when not in use, upgrading from conventional lighting to LED technology, fully insulating your business premises, and getting a smart meter installed. Smart meters can help you work out when your business uses the most energy and ensure your bills are accurate.
Read our guide to discover more about saving money on business energy bills
What charges are included in business energy bills?
The two main costs that make up your energy bill are the unit cost (the amount you pay for each unit of gas or electricity used, measured in kWh) and the standing charge.
However, there are a number of other costs that contribute the amount you pay overall. These include:
Business energy wholesale costs
The wholesale cost is the amount the supplier pays to buy energy in bulk before selling it on to customers. You won’t see the wholesale cost on your bill, but it makes up part of your unit rate.
Unless you’re on a fixed rate tariff (where you pay an agreed rate for each unit of energy you use over a set term), your energy bills will usually rise when wholesale costs do.
Transmission Use of System charges (TNUoS)
This covers the cost of maintaining and upgrading the National Grid. It is usually included in the standing charge.
Paying for Distribution Use of System (DUoS)
Distribution Network Operators (DNO) are licensed by Ofgem and distribute electricity in your area. The DUoS charge covers the costs incurred by your DNO and will vary depending on the type of contract you have, your meter type, your location and time of use.
Climate Change Levy
The Climate Change Levy (CCL) was introduced by the government in an effort to encourage businesses to become more energy efficient in how they operate and to reduce their carbon emissions. The cost is charged per unit of energy and will be factored into your overall energy bill. You can find out more about the CCL, including which businesses are exempt, in our guide
Value Added Tax (VAT)
Most businesses are charged VAT at a rate of 20% on gas and electricity and this will automatically be added to your energy bill. However, some businesses may be eligible to pay a reduced rate of 5% – you can find out more in our guide.
How can I pay my business energy bill?
There are several ways to pay your business energy bill, including:
Direct debit
Many suppliers offer a discount if you choose to pay your energy bills by monthly or quarterly direct debit. However, it’s important to regularly check you are paying the correct amount and that you are not building up either too much credit or debt on your account as the months go by.
Keep in mind you are likely to use more energy in the winter so any credit built up in the summer months could help to cover your increased use.
BACS or bank transfer
With this option you can wait until your energy supplier sends you your bill and then make your payment by BACS or online bank transfer. The advantage is that you know exactly how much you’re paying each time. The disadvantage is that you need to remember to make the payment.
Cheque or giro
Some suppliers still allow customers to pay for their energy bills by posting a cheque, but you’ll need to remember to allow time for your cheque to arrive to avoid paying a late fee.
Alternatively, your energy bill may have a giro bank slip attached which you can take to your local Post Office to make the payment.
How can I reduce my business energy bills?
One of the easiest ways to reduce your business energy bills is to switch to a cheaper tariff as soon as your existing contract comes to an end.
Your energy supplier will contact you once your contract enters its ‘renewal’ window and it’s at that point you should start shopping around and comparing tariffs – if you don’t, you’ll be moved on to your supplier’s expensive ‘out-of-contract’ rate.
Other simple steps to reduce bills include shutting down office equipment when not in use, upgrading from conventional lighting to LED technology, fully insulating your business premises, and getting a smart meter installed. Smart meters can help you work out when your business uses the most energy and ensure your bills are accurate.
Read our guide to discover more about saving money on business energy bills
