Where business energy costs come from
A business pays for each unit it buys, plus standing charges, network and policy costs, and the Climate Change Levy. There is no price cap for business contracts. Smaller users pay more per unit (DESNZ):
Average business electricity prices, April to June 2026, pence per kWh including CCL, excluding VAT (DESNZ, provisional)
| Annual use | Price per kWh |
|---|---|
| Very small (up to 20 MWh) | 38.4p |
| Small (20 to 499 MWh) | 28.6p |
| Medium (2,000 to 19,999 MWh) | 25.2p |
| All non-domestic users (average) | 24.5p |
The biggest uses differ by business: lighting and heating in offices and shops; refrigeration in food businesses; compressed air, motors and process equipment in factories. Know yours before you spend money. A year of half-hourly data shows when you use power, and business electricity prices explains the rest of the bill.
Use less: the quick wins
From the Carbon Trust's SME guides (net zero guide, energy management guide):
- Routines cost nothing: Start-up and shut-down procedures, and switching equipment off when not needed. The Carbon Trust says bottom-line savings can often be achieved with no capital expenditure.
- LED lighting: Upgrading from conventional lighting to LED luminaires could cut lighting costs by up to 80%, with controls that switch or dim lights automatically saving more.
- Heating controls: Time and temperature controls set for how the building is really used. Weather compensation and optimum start controls can pay back in months.
- Boilers and pipework: A regularly serviced boiler can save as much as 10% on annual heating costs; insulate boilers, tanks, pipes and valves.
- Compressed air and refrigeration: Fix leaks, cut pressure, and keep condensers clean: often large savings where these run all day.
These come first because they are cheap, and because a site that uses less needs a smaller solar system to cover the same share of its demand.
Shift use into the day
Once you have solar, the most valuable electricity is the electricity you use as the panels make it, because it replaces power you would have bought. Exported power earns only what an export tariff pays. So look at what can move into the middle of the day:
- Charging: Forklifts, tools and vehicles charged late morning to mid afternoon instead of overnight.
- Hot water and laundry: Electric water heating, washing and drying run while the sun is up.
- Batch processes: Compressors, pumps and other flexible loads scheduled for daylight.
- Cooling: Pre-cooling stores and chillers at midday where the process allows.
Where a load can't move, a battery can carry midday output into the evening; whether it pays depends on the gap. See commercial battery storage.
Generate your own with solar
Every kWh of solar you use on site is a kWh you don't buy, at the price you pay, which for the smallest business users averaged about 38.4p in April to June 2026 (DESNZ). And HMRC says that where you are an auto-generator there is no requirement to account for the Climate Change Levy on self supplies of renewable source electricity (Excise Notice CCL1/3; see the Climate Change Levy).
Solar suits businesses that use most of their power in daylight hours, through the working week, all year. It suits them less if most use is at night. How to judge yours: how much solar your business needs and commercial solar payback.
Energy audits: what they cover and where to get one
An energy audit looks at the whole site: where energy goes, what could be cut, and what each measure costs and saves. Large undertakings must have one under ESOS. For smaller businesses:
Free or part-funded energy advice for businesses, checked 3 November 2026
| Where | What is offered |
|---|---|
| Scotland | Business Energy Scotland: free, impartial support for SMEs (Business Energy Scotland) |
| Wales | Business Wales: a fully funded adviser's report, and a grant for up to 50% of a detailed audit, to £10,000 (Development Bank of Wales) |
| Northern Ireland | Invest NI: expert advice on saving energy and cutting waste (Invest NI) |
| England | Ask your local growth hub, which can point to free advice and financial help (GOV.UK) |
A solar site survey is not an energy audit. It looks at one measure in depth: your roof or land, your daytime use and the right size of system. We say so because the cheap wins above should come first. Grants and loans by nation: solar panel grants for businesses.
Sources
DESNZ table 3.4.2 (Q2 2026 provisional) and the Carbon Trust guides read on 3 November 2026; Business Energy Scotland, Development Bank of Wales, Invest NI and GOV.UK pages on 2 and 3 November 2026. Carbon Trust savings figures are their own estimates, not guarantees for your site.
- DESNZ: Gas and electricity prices in the non-domestic sector (table 3.4.2, Q2 2026 provisional)
- Carbon Trust: The journey to Net Zero for SMEs (introductory guide)
- Carbon Trust: Effective energy management for business
- HMRC Excise Notice CCL1/3: renewable self-supplies not liable to CCL
- Business Energy Scotland: free support for SMEs
- Development Bank of Wales: Green Business Loan Scheme (Business Wales report and audit grant)
- Invest NI: Reduce waste and save energy
- GOV.UK: Get help and support for your business (growth hubs and national helplines)
Frequently asked questions
What is the quickest way to cut a business's energy costs?
Stop paying for energy you don't need. The Carbon Trust says bottom-line savings can often be made with no capital spending, through start-up and shut-down routines, switching things off and getting heating times and temperatures right. Low energy LED lighting is usually the next step: it says upgrading from conventional lighting could cut lighting costs by up to 80%.
How much can a business save on energy?
The Carbon Trust says businesses can often save around 20% through improvements to key systems, and sometimes much more. How much depends on what you use energy for: lighting, heating, cooling, compressed air and processes each have their own savings.
What is a business energy audit?
A review of where a site uses energy and what it could do to use less, with costs and paybacks for each measure. Large undertakings must have one under ESOS. Smaller businesses can get free or part-funded advice through Business Energy Scotland, Business Wales and Invest NI, and in England through their local growth hub.
Is a solar survey the same as an energy audit?
No. A solar site survey looks at one measure in depth: whether your roof or land suits panels, how much your daytime use would absorb, and what size of system makes sense. An energy audit looks at everything. If you haven't had one, the two work well side by side.
Does solar save more for a small business?
Per unit, often yes, because smaller users pay more for each kWh they buy. DESNZ's provisional figures for April to June 2026 put the very smallest business users at about 38.4p per kWh, against a 24.5p average, both including the Climate Change Levy and excluding VAT. Each kWh of solar you use yourself saves what you would otherwise have paid for it.
Related pages
- Business electricity pricesPublished DESNZ figures show what businesses pay per kWh by size of user; your own unit rate is what solar replaces.
- Energy data analysisHow half-hourly consumption data shapes solar sizing and payback: getting the data, profile classes, baseload, weekend and seasonal use, self-consumption and batteries.
Battery storageWhen a commercial battery pays: storing surplus solar, time of use tariffs, peak shaving, sizing from half-hourly data, illustrative costs, safety and siting.- Renewable energy for businessOn-site solar, storage, off-site PPAs and green tariffs compared, with what each does for cost and for reported emissions.