As the prices of energy are going up around the UK, more and more businesses are worried about being able to pay for their gas and electricity bills. At Niccolo Gas & Power we are committed to helping energy customers navigate these difficult times. This is why we prepared an overview of what your options are if your small business cannot afford its energy bills.
Are you a micro business?
To be considered a microbusiness, your small business must meet the following criteria:
- Have fewer than 10 employees
- Have a turnover of less than £1.8 million
Your business can also be classified as a microbusiness if it employs more than 10 people but it:
- Uses less than 100,000 kWh of electricity a year
- Uses less than 293,000 kWh of gas a year
Depending on your consumption, your business might be a microbusiness only for electricity or only for gas. If this is the case, you have to get separate quotes when looking for a new supplier.
Knowing whether your company is a microbusiness is important to determine what help you can get to cover your bills. For example, you can get support from the government for your microbusiness if it is trading in the UK and has a turnover of £45 million or less.
Energy Bill Relief Scheme
All types and sizes of businesses in the UK can get help with their energy bills under the Energy Bill Relief Scheme. This programme was introduced to help businesses with energy costs from 1 October 2022 to 31 March 2023. As part of the scheme, discounts are automatically applied to the energy bills of all non-domestic customers. This means that if you own a small business, you do not have to do anything to get support.
The discount represents the Government Supported Price and is calculated using the wholesale prices of energy. The Government Supported Price currently stands at £211 per megawatt-hour (MWh) for electricity and £75 per MWh for gas.
My business is in debt to the supplier
The first thing you should do if your small business is struggling to pay its gas and electricity bills is to contact your supplier. You should explain to them what your situation is and discuss ways to pay the amount you owe them.
Suppliers understand that the current situation is unprecedented and so they try to come up with a personalised payment plans for the most vulnerable customers.
If you are already facing debt, you should act as quickly as possible. Otherwise, your energy supply might be disconnected. Sometimes, if a supplier needs to disconnect your supply, they might have to schedule a court hearing. This could mean additional stress for you.
And, if you have to be disconnected due to debt, you will most likely have to pay a disconnection fee which would make your debt even higher. Then, once you settle all the payments and you are reconnected, you will have to pay yet another fee.
If you are not sure how much money exactly you owe, reach out to your supplier. They will provide you with a detailed overview of outstanding payments.
My supply has been disconnected
If you do not pay your business energy bills, your energy supplier might notify you about their intention to disconnect your supply. Then, you will typically have 28 days to pay your bill. Your contract with the energy provider should include information about how much time you have to cover all the bills before you are classed as being in debt.
If you fail to pay your bills within the allowed timeframe, your supplier must give you only 7 days notice before your supply is disconnected. Your energy supplier might contact you by phone or mail before that happens. You should try to negotiate with them and arrange a solution allowing you to pay off the debt without having your supply disconnected.
Your supplier has to enter the property to disconnect your supply. If you refuse to let them in, they will need to get permission from a court.
Why are my bills so expensive?
Businesses across the UK are facing very expensive energy bills. This is mainly due to increases to wholesale energy prices. However, if you think your bill is higher than it should be, call your supplier and ask them to verify whether it has been calculated correctly.
Sometimes you might find out that you have been paying for estimated energy bills which tend to be more expensive. This can happen if you have not been providing the supplier with regular meter readings. Luckily, if you submit the actual readings, the supplier can correct your bills and you might be able to get your money back.
Also, as a microbusiness, you can only be billed for the energy you have consumed in the last 12 months. If a supplier charges you for energy used more than 12 months ago, you can call them and complain.
If the bill is right but you cannot afford to pay it, you can ask your supplier if you can arrange an alternative payment plan.
I am struggling to pay my business energy bills
While prices of business gas and business electricity are out of your control, there are a few things that can help you reduce your business energy bills.
- Switch suppliers
There are tens of different suppliers operating in the UK so after comparing their tariffs, you might determine that other energy providers offer more competitive rates. Luckily, as the UK enjoys a deregulated market, you can easily switch suppliers. The process of switching is easy and quick.
- Change contracts
Even if you do not find a supplier that offers more competitive tariffs than your existing provider, you should verify what other contracts you can get with your supplier. This is especially important if your initial contract ended and you did not choose a different one. In such situations, businesses are typically placed on deemed contracts that tend to be the most expensive ones.
- Get a smart meter
If you are getting estimated bills you might be paying more than you should be. Taking regular meter readings is one way to avoid estimated bills. But, an even easier way is getting a smart meter.
UK businesses can get smart meters for free so if you do not have one, you should have one installed as soon as possible. Smart meters automatically send your readings to your supplier so you do not have to remember about it. By getting a smart meter, you can be sure that you are being billed only for the energy you actually consume.
- Lower your energy consumption
While unit prices play a role in your total bill, how much energy and gas you use also determines how high your bills are. So, by reducing your consumption, you can lower your energy bills. A few tricks to do so are:
- Do not leave electronic devices plugged in
- Change light bulbs to energy efficient ones
- Make sure the building is properly insulated
- Make the most of natural light
- Fix any leaks
- Install timers and thermostats
- Contact your supplier
If you followed all the tips discussed here and your bills are still so expensive you cannot pay them, you should contact your supplier. You can typically get their contact details from their website. You should explain to them what is happening and tell them what you want to do to solve the problem. They might be able to agree to your proposition or suggest other solutions.