After the recent announcement from the chancellor, Jeremy Hunt, announcing a cut to the financial support offered to businesses to help with their energy bill, Lee Roberts, Content Manager at Business comparison site Bionic, has put together a checklist to prepare for when the scheme ends, looking at whether there is anything your business can do to prepare for prices going back up next year?
Lee Roberts, Content Manager at Bionic, shared his thoughts on the impact of the cut of the energy support scheme on small, independent businesses.
Roberts said, “Although less generous than the Energy Bill Relief Scheme, it’s good news that the government’s new Energy Bills Discount Scheme will offer universal support to businesses faced with high energy bills.
!As expected, the government has cut the amount of support it will offer businesses, especially those that don’t fall into the Energy Trade Intensive Industries category. Small businesses that are already struggling as a result of the current economic instability and a post-Christmas lull in customer spending could be hit hardest when their energy bills increase.
!Although wholesale energy prices are falling, there is a possibility that prices may rise again and many businesses will see their bills increase when the Energy Bill Relief Scheme ends in March.
“That’s why it makes sense to prepare now, by keeping an eye on when their current fixed rate deal is ending and making sure their businesses are as energy efficient as possible. The new scheme only be available to “non-domestic customers who have a contract with a licensed energy supplier”.
“This means that you won’t be eligible for a discount if you’re on your supplier’s deemed or out of contract rates. If you’re in this position, or if your current contract is ending soon, it makes sense to compare deals and lock in your rates to avoid paying your supplier’s more expensive rates and make the most of the Energy Bills Discount Scheme.
“If you do find yourself struggling to pay your energy bills, you should contact your supplier and discuss your situation with them as soon as possible. They might be able to review your contract or agree on a new payment plan that is more manageable for your business. You can ask for more time to pay, access to hardship funds, payment breaks or a review of your payments in some cases.”
How can I reduce how much energy my business uses?
To limit energy consumption, you could:
- “Swap your bulbs — Switch your usual bulbs to modern LEDs, CFL or halogens. Although you may pay out a bit more upfront, the switch could save your business on its energy bills, as these bulbs usually last longer.
- Educate your staff — Ask your team to switch off their computers at the end of the day, turn off lights if they’re not in use and only run the hot tap in the toilets for as long as they need to.
- Think about the long term — If you’re considering long-term energy efficiency, you could install motion sensors in your corridors and toilets. This will only turn the lights on when someone is using the room.
- Only heat your premises at certain times — Try to use limit your heating usage as even overheating your business by a few degrees can drastically increase your energy bills. You could also move any furniture that might be in front of radiators as this can block heat coming through, costing your business more.
- Draught-proof your premises — Draught-proofing is an effective but cheap way to save energy. If you’re letting draughts come through cracks or gaps in windows, you might as well not be heating your premises at all. Maybe look into double glazing to draught-proof your building in the long run.”
Are there any other ways to cut business costs?
“It’s tough to cut costs when the price of everything is going up, and you might have some difficult money-saving decisions to make when the Energy Bill Relief Scheme ends.
Although not ideal, you might need to increase your prices to help cover the higher overheads or cut back on any growth plans. You might even need to consider reducing your opening hours, cutting staff hours, or losing some members of staff completely.
There are also some less drastic measures you can take, such as switching to cheaper service or stock providers, making sure you’re not signed up for any subscription services you no longer use, and checking out if your business is eligible for tax relief. You can find out more in our guide to claiming allowances and tax breaks.
Switching to a better deal on other business essentials is a quick and easy way to cut costs without impacting the quality of your goods and services. At Bionic we can compare business phone, broadband, and insurance to help you sort more suitable and competitively-priced contracts.”