Are You Paying the Correct Amount for your Commercial Gas and Electricity?
With news in November of another two energy suppliers (Extra Energy and Spark Energy Supply) ceasing trading and with many suppliers also increasing their prices significantly, it has certainly become a confusing time for business owners to know from whom they should be buying their gas and electricity.
For most, price is the main driver of any decision, especially when large consumers could be allocating tens of thousands of pounds of their quarterly budget to the cost. However, with seven suppliers now having ceased trading in 2018 alone, it pays to dig a little deeper.
There are over forty commercial energy suppliers currently in the market, all of whom have their strengths and their weaknesses. The “Big 6” often rely on their legacy and their name to install confidence in the buyer, but often lack some of the niche assets that smaller suppliers hold and are regularly being beaten on price by newer entrants to the market who are keen to take market share.
As a commercial user of gas and electricity, it pays significantly to “shop around”, but it is an exercise best completed with a certain level of knowledge and understanding. To a certain level, this knowledge can be obtained via a little online research but, as is normally the case, it is wise to use the services of an expert. This is especially the case now, as what you are paying for is not simply the commodity itself.
The price you pay for your gas and (especially) electricity is made up of more and more (and ever complicated) taxes and charges, to help maintain an ageing National Grid that is under more demand than it has ever been. In fact, almost 60% of the price you pay for your supply of electricity are “non-commodity” charges, of which there are over ten different ones. When going through the procurement process, it is vital to know what these are and to ensure that the contract you are being offered takes all of them into consideration, otherwise you might just get a nasty surprise when you receive your first invoice.
As mentioned in my first paragraph, price (and knowing how it is made up) is not the only consideration you should have. A cheap rate usually reflects upon the supplier’s level of resources (i.e. its level of customer service). Using a well-established broker or consultant removes this concern, but if you are going through the procurement process alone, then make sure you check the supplier’s ability to deal with your queries effectively…… and their ability to remain in business!
If you have any questions relating to this article, or would like further information, please contact Marc Wheatley on 020 8952 0125 or 07712 406605, or by email at email@example.com, or click on the following link: