Simple Business Energy Saving Tips

Posted on August 31, 2012 by Kathryn

Simple business energy saving tips will not only help to reduce your business energy bill but will also cut your carbon emissions.

The Hub has looked at a number of different ways of reducing business energy and therefore cutting business energy bills. Here are a few more suggestions to help reduce your business energy bill.

Previously The Hub has mentioned that at the end of the day or at the weekend, if the office is closed, peripheral devices such as printers and photocopiers should be turned off and not left on stand-by. However, in order to reduce costs further, if possible, try not turning your printer or photocopier on until 10.00am. You could also try switching it off for an hour at lunchtime and even come to an agreement that they can be turned off at 4.00pm or for example, an hour before the office closes.

Remember that if you need to replace your office printer or photocopier, look at the energy efficiency ratings of possible replacements. Don’t spend money replacing your machine with one that’s going to cost you even more in energy consumption.

If you need to print, (remember – think before printing out that email) ensure you only print in full colour if you really need to. Furthermore, if you photocopy things lighter you won’t use as much toner – do you really need the photocopy to be that dark?

Finally, if you need to replace the appliances in your kitchen ensure you do so with energy efficient ones. And don’t over fill the kettle when you boil it!

What Makes Up Your Business Gas Or Electricity Bill?

Posted on August 29, 2012 by Ollie

Business energy bills aren’t just made up of the cost of electricity or gas so what actually makes up your business gas or electricity bill?

Last week The Hub looked at The Climate Change Levy, which is part of your business energy bill, but what other factors make up your business gas or electricity bill?

The majority of your business electricity or gas bill is made up of wholesale costs, which is what we’d expect. As you can see from the British Gas figures, 42% of your electricity bill is made up of wholesale electricity costs while 44% of your business gas bill is made up of wholesale gas costs.

However, it’s taxes and environmental charges which make up the next largest proportion of your business electricity or gas bill. Looking at the British Gas figures 24% of its business electricity bill is made up of taxes and environmental charges which include things like the Climate Change Levy, Feed-In Tariffs and the Renewables Obligation. In comparison a smaller proportion of a British Gas business gas bill is made up of environmental taxes but it’s still the next highest figure at 19%.

The third largest part of an energy bill is the transmission and distribution costs. These figures are similar for both gas and electricity – 16% for electricity and 17% for gas. Operating costs make up the next biggest proportion of an energy bill with the final proportion being the profits made by the energy company.

As you can see from the diagrams less than 50% of your energy bill is made up of wholesale energy costs. In fact, 50% of a business gas or electricity bill is made up of transmission and distribution costs, taxes, operating costs with around 6 or 7% of a bill being made up of energy supplier profits.

These figures are for a British Gas business electricity or gas bill but will be similar for other business energy companies.

E.ON Repeats Promise Not To Increase Prices In 2012

Posted on August 28, 2012 by Ollie

SSE announced they are to increase energy prices by 9% in October but E.ON has repeated its promise not to increase standard energy prices in 2012.

Utility Exchange reported in May that E.ON had promised not to increase energy prices in 2012. However, the recent announcement by SSE that energy prices would increase from October has raised concerns that the rest of the Big Six energy suppliers are set to increase gas and electricity prices too.

As a result the Chief Executive of E.ON UK, Tony Crocker said “In May I promised our millions of customers that we would not raise our standard energy prices and given all the concern and speculation in recent days, I wanted to let our customers know that our standard energy prices won’t rise one penny in 20121. It’s too early to say what will happen beyond the end of the year but as we’ve proved with this price promise and the major changes we’ve made as part of our Reset Review, we’ll do everything in our power to help our customers”.

E.ON recently announced an increase in profits and there were hopes that the company would cut prices as a result.

E.ON has made changes recently as a result of its Reset Review. The company announced they would introduce single sheet bills, end two tier pricing and doorstep selling and help SME’s. In April, Utility Exchange reported that the energy giant had announced a 7 step plan for small businesses.

In its recent press release E.ON said it will shortly launch best E.ON deal for you. This plain English best tariff will be available to customers either online or by speaking to an E.ON customer service advisor. E.ON has made over 30 changes as part of its Reset Review and is also working on improving energy efficiency for its customers.

So after SSE’s announcement that it will increase energy prices in the autumn one of the other Big Six energy suppliers has declared they won’t increase prices this year. Whether any of the other Big Six energy providers do remains to be seen. The threat of future domestic price rises also means there’s the possibility of business electricity and gas prices going up further too.

What Is The Climate Change Levy?

Posted on August 23, 2012 by Kathryn

Have you ever studied your energy bill and asked “what is the Climate Change Levy”?

Your business energy bill isn’t just made up of the cost of gas or electricity. It includes other charges including the Climate Change Levy (CCL), VAT, independent gas transporter (IGT) charges and sometimes smart meter charges. This is in addition to the standing charge and unit rate.

Most of us have heard about the climate change levy, but what is it and why do businesses have to pay it?

The Climate Change Levy is an environmental energy tax. It was part of a legally binding commitment made by the UK at the Kyoto Conference in 1997. The commitment the UK government agreed was to reduce greenhouse gas emissions by 5.2% below 1990 levels by 2008/2012. The CCL has been part of business energy bills since April 2001 and is charged on the business use of energy. The idea of the CCL is that businesses work towards becoming more energy efficient and reducing their greenhouse gas emissions.

The CCL applies to industrial and commercial energy supplies to different sectors including the industrial, commercial, agricultural, public and service sectors.

CCL is charged on natural gas, electricity, petroleum and hydrocarbon gas in liquid state, coal, lignite and coke. These are what are known as “taxable commodities”. However, CCL isn’t charged on road fuels – this has its own excise duty. It’s also not charged on fuel used by domestic consumers or the transport sector. Very small businesses which use a similar amount of energy as a domestic consumer are also not liable for the CCL.

Suppliers of these commodities charge the CCL and then pay this to HM Revenue & Customs. It’s added to your business energy bill before VAT and many energy suppliers will put it down as a separate item on your bill.

If you use renewable energy then you don’t have to pay any of the CCL. Neither do you have to pay it if your business has a domestic or residential aspect to it. For example, if your business is a care home or a B&B.

Some energy intensive users may be able to get discounts of up to 80% on the CCL as long as they have made significant energy savings targets which have been agreed between their trade organisation and the Government.

For further information on the Climate Change Levy you can refer to the Department of Energy & Climate Change website.

SSE Announces Gas & Electricity Price Rise

Posted on August 23, 2012 by Kathryn

SSE has announced energy prices will increase by an average of 9% from 15 October.

After cutting gas prices by 4.5% in January, Utility Exchange reported that SSE promised not to increase prices until October. Today the energy provider has announced that prices will rise by an average of 9% on 15 October. The company last increased energy prices in September 2011 when gas prices increased by an average of 18% and electricity prices rose by an average of 11%.

The energy provider blames the price rises on several factors including the increase in the cost of using the electricity and gas networks, the cost of mandatory government sponsored schemes and an increase in wholesale energy prices. These increased costs the energy supplier says, now have to be “reflected in household gas and electricity prices”.

Utility Exchange reported recently that the Bank of England warned of increases in energy prices as a result of higher wholesale costs and a rise in the cost of delivering energy.

Both gas and electricity prices will increase by 9% from 15 October but the energy company says it will “cap household energy prices at this level until at least the second half of 2013”.

In a statement the chief executive of SSE, Ian Marchant, said “In a time of economic difficulty, we have endeavoured to keep energy bills as low as possible. That is why we pledged last summer to cap our energy prices for as long as possible and until at least August 2012, and then in January extended this pledge to October 2012. Unfortunately, the increases in costs that we have seen since making this pledge can no longer be absorbed and mean that we are unable to keep prices at their current levels beyond this autumn. An increase in our prices has therefore, regrettably, become unavoidable”.

He continued “We remain committed to offering a fair price for the energy we supply and providing a range of practical and financial support measures for those struggling to pay their bills. We will also continue to build on the initiatives introduced over the last year to create a simpler and more transparent approach for all energy customers”.

It seems it’s now only a matter of time before the rest of the Big Six energy companies follow suit. Which one will be next and are business energy prices set to increase further too?