Business Gas Comparison

Short-term deals (from three months to one year) offer more flexibility but might come with higher unit rates. These contract deals are useful, especially if you’re anticipating making a change soon.

A longer business gas contract (from one to five years) locks in lower energy prices for an extended period but usually incurs exit fees should you opt out early.

As mentioned, leaving your current business gas supplier before the contract end date generally results in exit fee penalties.

If the new supplier offers an exceptional deal with unbeatable prices, the cost of exit fees might be worth it. However, it’s good to weigh up the cost savings against the penalty charges to make a more informed decision.

These fees are applied to compensate the energy provider for early termination. Generally, commercial gas suppliers charge between 5% and 15% of your estimated business gas supply for the remainder of the contract.

These include both unit price per kWh and standing charges, although these totals can vary between different suppliers.

The good news is that business gas contracts are tied to commercial locations, not to the actual business or business owner. So, if you’re relocating business premises, you won’t incur any penalties!

Do notify your current supplier about your planned move and ensure you find a good business gas deal for your new location. This is to avoid expensive deemed tariffs – making comparing business gas rates so important!

If your business operates at scale and consumes more than 100,000 kWh of gas annually, energy providers classify you as a “large corporation”.

When considering large business gas contracts in the UK, there are several key factors to bear in mind:

• Price: Look for a reliable energy provider offering fixed-rate plans to avoid fluctuating unit prices. This allows for better financial planning and budgeting.
• Contract terms: Pay attention to the duration of your energy contracts, which typically range from a few months (i.e. short term) to several years (i.e. long term). Make sure you understand the payment terms, penalty fees, termination dates etc.
• Quality of gas: Ensure the gas provided is of good quality, as this can impact your business operations. Low-quality gas can emit substances and chemicals that are harmful to humans and the environment.
• Regulations: Make sure your chosen gas supplier is legally registered, certified, and licensed to operate.

Multi-site customers could benefit from supplier discounts because of the large amount of gas used across multiple locations.

Useful insight: Commercial energy suppliers often compete for your business if you consume high gas volumes. This gives you a competitive advantage when it comes to negotiating lower business gas rates. 

Small and medium-sized businesses (SMEs) make up 99.9% of the UK’s private business sector. They typically use between 5,000 kWh and 25,000 kWh of gas each year.

SMEs usually opt for fixed energy contracts for their gas and electricity supply, lasting one to three years. This ensures operational costs are budgeted for efficiently and gives you peace of mind knowing that market price volatility is taken care of. Much like larger businesses, other factors need to be considered such as:

• Price
• Contract terms
• Gas quality

Commercial gas suppliers structure their pricing based on annual usage and the size of your business. Small businesses generally have lower gas consumption.

Note: No matter the size of your business, all commercial gas consumers are charged 20% VAT.

Independent Gas Transporters (IGTs) are companies that own and manage their own networks of gas pipelines, separate from the main Gas Distribution Network (GDN). The National Grid originally operated these networks. IGT companies came into existence when the energy market was deregulated, allowing smaller suppliers to enter the market and compete.

But what does it mean to have IGT gas?

Essentially, there’s no significant difference in the quality or reliability of the gas supplied by IGTs compared to that from the National Grid. It just means that an independent gas supplier is one of the companies that came into the market when it was opened to competition.

If your business is supplied by an independent gas transporter, your gas meter should start with either 74, 75, 76 or 77.

You can still compare business gas suppliers and switch with IGTs, but the switching process may take longer and standing charges will usually be more expensive.

Useful insight: IGT networks supply around one million consumers in the domestic and non-domestic sectors. 

Pro tip: Don’t just compare one business gas quote; review multiple gas prices and deals from various gas providers. This ensures you find the best business gas rates.