Help to get you the best business electricity deal
When it comes to electricity procurement, a basic knowledge of the industry can make a big difference to the price you pay. The following is offered as a guide to help you get the best deal
Choose the best tariff for your needs
Your tariff depends on the type of meter installed at your premises and there are several available to suit every type of business. Tariffs vary between suppliers but at Power NI, we have three quarterly-billed tariffs to choose from, the best depends on your own operations and opening hours:
- Popular – best for mixed retail, offices & premises with 9-5 opening hours
- Nightsaver – best for food retail, premises with storage heating or lots of fridges/chillers
- Weekender – best for pubs, restaurants etc. & premises open mainly in the evenings & at the weekend
- If you have a supply of more than 70kVA, you will most likely be monthly-billed on a multi-rate tariff which offers different prices at different time bands e.g. Winter Peak, Winter Day, Summer Day, Evening & Weekend etc.
Explore your discount options and contract offers
The most convenient way to pay your bills is by Direct Debit. At Power NI, even if you are quarterly-billed you can choose to pay for your electricity monthly (pay agreed amount on an agreed date each month towards your bill, good for budgeting) or quarterly (pay full amount 14 days every three months after bill arrives). SMEs can receive up to 4% discount for choosing to pay by Direct Debit with Power NI. Other supplier’s discounts may vary.
Most suppliers offer online billing options instead of receiving your bill in the post. This cuts down on paper and allows you access to an online billing portal where you can view all your account details at any time. With Power NI’s Energy Online platform, you can access all bills from the last two years, view all payments, track your energy consumption and submit meter readings. Quarterly-billed customers who pay by Direct Debit can also receive an additional 2% discount for choosing online billing
Most suppliers offer a range of contracts, often for 12 or 24 months:
- Fixed Price contracts offer some stability for the duration of the contract in that your ‘energy only’ rate is fixed for a period of time. However, they usually carry a premium and if your timing is not well judged you risk being tied to out of date prices that are higher than the market rate. You also may incur penalty charges if your consumption changes significantly and you are still subject to any changes in general network and market charges
- Variable Price contracts track the wholesale market and allows you to benefit should prices fall, however the flip side is that you are also exposed to price increases. Variable Price contracts gives you more flexibility on volume if that is what your business needs
Be aware of other costs involved
Almost half of the cost of electricity is overseen by the Utility Regulator, including NIE Network’s charges, various market charges and levies. These are the same for all suppliers who usually treat them as ‘pass through.’ Some suppliers quote ‘energy only’ prices so make sure to include the pass-through charges when comparing offers.
Climate Change Levy (CCL)
CCL adds around 4% and is set by HM Revenue & Customs.
Most energy used for commercial purposes is subject to VAT at 20%. However, the actual rate you pay depends on how much electricity you use, what you use it for, and whether you are a registered charity. Non-domestic supplies with more than 60% of their electricity used for domestic purposes can claim to pay only 5% VAT as well as any non-domestic supplies that use less than 33 units a day (around 3,000 a quarter). Read our VAT guide for more information.
Wholesale energy and supplier costs
The largest portion of your bill is made up of wholesale energy and supplier costs. The final price you pay will depend on the details of your contract with your chosen electricity supplier.
Wholesale electricity is traded between generators and suppliers in the all-island Single Electricity Market (I-SEM)where prices vary every half hour depending on supply and demand and the price of fuels in global markets.
A little homework
To help with your decision-making, it’s always best to gather some basic information. A quick online search will tell you what happened to wholesale electricity prices last year and what the forecast is for the coming year. Lots of things can affect the prices, including supply & demand, geo-political issues, weather and government policies.
You may also wish to forecast the amount of electricity you expect to use in the coming year, factoring in the impact of any energy saving activities you may have planned. It could also be useful to assess both the risk and benefit of choosing a Variable Price contract versus a Fixed Price contract.
Check your current contract (and any notice period) and make sure your meter readings are up to date - this will help any change of supplier go more smoothly. Suppliers will want to know some information about your business to complete checks, so have all the information to hand when seeking quotes (e.g. your company registration number) and copies of your recent bills can also be really helpful as they will have the your meter details and annual consumption printed on them.
Get ready to act quickly – get your comparison ready to evaluate and the decision-maker ready to sign on the dotted line as most offers are valid for short periods of time.
It’s important to establish what after-sales support you will get from your supplier, if they offer any energy saving support or advice, opportunities to avail of grants and offers, and if they are able to offer Green Energy generated from renewable sources.
Get a quote for your business electricity