Energy

Short Guide to Difference Between Domestic and Business Energy

Short Guide to Difference Between Domestic and Business Energy

Many entrepreneurs will know how the domestic energy contract works but business energy contracts have some key differences that one should know. Let’s unpack the details regarding domestic and business energy. 

Is business energy any cheaper than domestic? 

New entrepreneurs may be wondering if the business energy is cheaper than the domestic one. Unfortunately, the answer is not that simple but rather complex. There are many factors that one should take into consideration before comparing the two energies. Although electricity and gas is supplied from the same source, suppliers offer different contracts to domestic and commercial. 

The two energies operate in different ways. Although domestic energy tends to be the center of attention from the media, understanding the subtle difference of business energy and how contracts work can help an individual get the best deal for their business. 

The energy rates

Electricity and gas unit costs can be cheaper for business customers than that for domestic ones. Businesses tend to pay a lower per-unit cost for energy due to the economies of scale and volumes. The bigger the size of a business, the lower the unit rate will be. While commercial rates can also be negotiated and clients in that sector can choose contracts that benefit them, domestic clients aren’t offered rates tailored to their needs and are charged the same unit price as the rest of the region. 

Why is business energy cheaper? 

If we put complexities on a side – business energy is cheaper as suppliers can sell higher volumes to business clients meeting economies of scale. The more usage of electricity – the better economies of scale for suppliers and hence the lower unit cost will be. 

The Criteria for Pricing

Generic pricing is followed for the domestic clients which depend on the geographical location and the payment method however, for business clients, the energy per unit cost depends on factors such as:

  • Business type
  • Contract length
  • Credit Score
  • Geographical Location
  • Demand Profile
  • Payment Method

Benefits of Business energy

There are several benefits that a business client can attain from business energy contracts. These include:

  • Better deals
  • Flexible or fixed pricing
  • Lower rates for electricity and gas
  • Great savings with business energy
  • Fixed prices that make it easier to maintain a budget
  • More contract options
  • The ability to tailor a contract according to the needs of the business
  • Locked in prices which make it less susceptible to fluctuations in pricing

Best business per unit energy rates

Finding the best deal for business energy can be time-consuming and confusing. However, business energy comparison is here to help. With the ability to compare over 150 business energy tariffs, an individual can easily compare the best prices and trusted suppliers who provide fantastic service and a great deal.

With the 3 simple and easy steps, the Business Comparison understands your needs and the business to search the network for the energy supplier to find the best deal. All the clients will have to do is count the energy savings!

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