How Does My Business Energy Bill Work?

How Does My Business Energy Bill Work?

Keeping control of energy costs is an important but often underappreciated aspect of running a well-balanced business. And, at a time when energy brokers are coming under heavy scrutiny, it is particularly worthwhile to check if you should be making a mis sold business energy claim

Any business owner knows just how much work goes into running an organisation and establishing solid cashflow. And after a challenging 18 months created by the global pandemic, keeping a close eye on outgoings has never been so critical. Although scrutinising your business energy bills probably may not be at the top of your never-ending to-do list, you should nevertheless take the time to ensure that you have negotiated competitive business gas and business electricity deals.

The three key aspects of your business energy bill are your standing charge, your unit rates and your contract end date. But there are other factors involved, too, including the potential of hidden business energy commission that you shouldn’t be paying. Getting to grips with the details contained within your monthly bill is the first step to effective business energy security.

What can you see on your business energy bill?

Standing Charge

This is the rate you pay every day for the supply to your business, regardless of how much energy you use. Business electricity deals always have a standing charge, but not all business gas tariffs do. Where the standing charge is low or non-existent, the costs this would have recovered for the supplier will be included in the unit rate.

Unit Rate

This is the amount you pay for each kilowatt hour (kWh) of electricity and gas you use. Getting the lowest unit rate doesn’t necessarily mean you’re paying the lowest price for your energy – it depends on how much you use. For heavy energy users, a low unit rate is vital, but for relatively light users, a low or no standing charge and higher unit rate could be preferable.

End Date

As the name suggests, this is point at which your current fixed price period ends. It’s important to take note of this because if an organisation fails to switch contracts ahead of this date, the contract will automatically rollover onto a less favourable variable contract.


The CCL – or Climate Change Levy – is a government levy that organisations pay for every unit of non-renewable energy used. You don’t have to pay CCL for any renewable energy you use, or if you use less than an average of 33 kWh of electricity and 145 kWh of gas per day. You also don’t have to pay it if your business has a domestic aspect to it, such as B&Bs, care homes and campsites.


Most companies will pay 20% VAT on their business energy bills. However, as is the case with CCL, you will pay less if you use less than an average 33 kWh of electricity or 145 kWh of gas a day. In this case, your VAT will drop to 5%. This is also true if you have a domestic element to your business.

IGT charges

Independent gas transporters (IGN) supply some businesses with their gas via pipes, rather than the default choice of the National Grid Transco. This can mean paying higher prices for your gas.

Smart meter changes

These days, many suppliers now provide smart meters as standard. The accuracy and regularity of these meter readings can help you to become more energy efficient, improve cash flow through accurate billing. 

The issue of hidden business energy commission

Increasingly, businesses are discovering that large and unfair commissions for energy brokers and suppliers are hidden within their bills. These hidden business energy commissions are not regulated by Ofgem, unlike in domestic energy contracts, and so there are many instances in which energy bills have been substantially inflated to earn brokers extortionate fees. 

However, the good news is that it is possible to pursue business energy claims with the right support from an experienced and reliable claims management company. Experts like Winn Solicitors are making it their mission to help customers pursue successful business energy claims, winning back the costs they should never have paid on their mis sold energy contract. Typically, claims can help organisations to recoup between 10 – 20% of a previous energy bill. 

If you think you could benefit from a mis sold business energy claim, the time to act is now. Call 0800 988 2281.

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