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Business Gas Prices

Business gas prices can vary greatly, this is mainly down to every business having different needs so it’s hard to provide a blanket cost, but you can take back some control by looking at what you could be saving on your standing charge rates and price per kwh unit . Understanding the meaning of these terms and what is a good price for both is essential to saving your business money on its gas expenditure.

Standing charge

The standing charge is a daily rate that you pay to your provider for having the gas supply. Standing charges may cover the costs of gas supply pipes, maintenance of your meters and meter readings. They are charged on a daily basis and are normally never over a pound. But making sure you have the best rate can save you hundreds over the course of even a year.

Below we have some examples of average standing charge prices;

Why do standing charges vary so greatly?

Depending on how much gas you use, standing charges can vary in hundreds over the years.It’s vital to make sure you do your research before signing a contract. If you are paying a low standing charge you will be paying more per unit price, and vice versa. It’s worth taking the time to really look over the figures to make sure you’re getting the best deal. So, if you have very low usage of gas usage, it is worth paying a lower standing rate and you will be charged a higher rate for the small amount of gas you use, which should work out more cost effective, whereas, if you have a larger consumption, it may make more sense to pay a slightly higher standing charge to receive a discounted unit rate.

What about zero / no-standing charge contracts?

Zero charges and no standing charges are different terms for the same kind of contract, you pay no standing charge for having the gas supply, you only pay for the gas units that you use. Sounds good? There aren’t many options available for these types of contracts although it’s not impossible to get one. It’s better for businesses that maybe close at certain times of the year so that they can avoid paying anything for their gas supply while trading has ceased. But for the times the premises are trading, you may be paying through the roof for the unit price. It’s a tricky weigh up but this option may be perfect for some business owners, maybe not for the majority though.

Currently the companies we have found that offer no standing charges are:

Price per Kilowatt Hour (kWh)

A kWh is a measurement of energy. Depending on your business you can go through anything from 500 kwh to over 1,000,000. With such a variation in usage it’s understandable why suppliers don’t provide set rates per kilowatt, they often have a banding system. You can use this to your advantage by knowing exactly how much gas your business will go through, that way you can compare which band you are in with competitors and see who offers the best kilowatt price for you.

Why do kWh (unit) prices vary so much?

There are many reasons why it can vary so much; amount used, supplier source, current market rates, market rates as date of contract agreement, transport costs, supply system costs, it can even depend on where your business is located. With so many factors to think of it’s important you know the ins and outs of what your usage and current unit price is to make sure you are on the path to saving money.

What Our Research Has Shown

Our team here at quote my energy talk to hundreds of business owners every day and they noticed just how different the variation in standing charges and kWh prices was. We decided to conduct our own research. We interviewed 10 businesses, ranging from a lower usage clinic to a higher usage construction firm.

First let’s look at standing charges, of the businesses we interviewed, we found there can be as much difference as 163p a day, over the course of a year this can cost your business up to £594 a year in unnecessary standing charge costs!If your business could benefit from a zero standing charge agreement, you could save thousands over the years. It’s all about weighing up what would benefit your business the most.

Next let’s have a look at the difference between kWh units. There was as much difference as 2.456p. Now let’s say on average, your business uses 40000 kWh units in gas. If you are paying 5.235p that’s going to cost you £2,094 a year in unit charges alone! Whereas if you shopped around for a smaller unit price, you could end up paying something closer to £1,108, that’s nearly £1000 saving, just from shopping around! The results are clear, if you don’t shop around for the best deals on standing charges and unit prices, you could be costing yourself thousands, unnecessarily!

Business Type Annual Consumption KWH Standing Charge (pence per day) Renewal Price
Construction 125000 0 2.77
Take Away Shop 136767 0 2.73
Specialist Rescue Centre 5712 163 4.208
Accountancy Firm 20000 38.95 3.081
Hotel 92000 0 3.619
Averages 75896 40.39 3.28

The Good News

Searching for gas quotes can feel never ending, but there is light at the end of the tunnel so to speak. Now you know slightly more about the way gas companies charge you for your gas, you are in a better position to take control. Remember to ask about standing charges and price per kWh, the more information you have, the more control you will have over what is right for you and your business! We all want to save money and here at Quote My Energy we are committed to taking the smoke and mirrors out of gas quotes and getting you the facts. It never hurts to shop around and who knows, one smart switch could save you thousands!

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