Cheap Business Electricity

As individuals we are used to having choice in our daily lives. We can choose where to shop for our food, clothes, Internet connection, even which school to send our children to. Until recently this was not possible when it came to choosing our electricity supplier in the UK. That all changed in the early 1990s when the supply of power in the UK was deregulated and competition entered the market.

The deregulation meant that customers were no longer tied to buying electricity from their local company but are able to take the best deal on the market.

The rising price of business electricity

It is important to find the cheaper power possible as the long-term direction of energy prices is expected to be upwards. The price rises will be due to a range of factors such as the cost of producing cleaner energy in future, and because Britain is no longer self-sufficient in energy, as North Sea gas supplies run out. Energy and climate change policies will increase electricity prices by around 33% by 2020, according to the Department of Energy and Climate Change's first Annual Energy Statement in July 2010.

Identifying your business needs

The first step is to identify the specific needs of your business. The first step to finding the least expensive electricity for your business is to know how much electricity you use as the cheapest business electricity can be found in bulk. The bulk price will depend on the number of kilowatt hours your company consumes per month. This will allow you to negotiate the best rate based on your needs.

Other information you will need to know when planning your switch are:

• Find out when your contract is due for renewal: Most businesses have fixed contracts. You can only switch at the end of the contract. Being aware of when your contract is due for renewal ensures that you are in a position to enable you to shop around and switch to better deals.
• Give adequate notice to your existing supplier: Most business energy suppliers have rolling contracts that are automatically renewed unless cancelled. Some suppliers require three months notice and, if you miss this deadline, your contract will be renewed and you will be tied in for another three months.
• Compare a range of prices: Brokers are paid a commission by energy companies for each business that they sign up and their rate varies from supplier to supplier. This can be an incentive for a broker to place business with a supplier that is more beneficial to them rather than your business. It is vital to get prices from a range of different suppliers so that you can make an informed decision and chose the best deal.
• Read the contract carefully: Many energy brokers do verbal contracts based on recordings of telephone conversations. These recordings can constitute a legally binding contract with the energy supplier. It is a sensible practise to request a copy of any quoted rates in writing before you commit to a contract.
• Check terms and conditions of your new contract: Before you switch, check the new supplier's terms and conditions carefully. A good broker can also help to identify the key points in the terms. For example, how much notice will you have to give at the end of the contract? Can the supplier change prices during the contract or are prices fixed? A good broker can help you answer all of these questions.

Comparing Prices

Unfortunately, with choice come confusion. There is now a plethora of deals, offers and "bargains" out there for business users and it has become a task in itself to find the best deal. Of course, prices change and what was the best deal when you made your choice may no longer be the best deal six months down the line. Be prepared to make sourcing cheap electricity an on-going objective, checking and comparing prices on a regular basis to make sure you are still on the best deal.

There are a large number of sites that have been set up to make switching supplier and finding the best prices easier. They often have sections to help business as well as domestic customers.