Home » Business

Small Businesses Doing Little to Save Themselves From "Fuel Poverty"

Aug 27, 2008
An independent survey commissioned by Electricity4Business, an electricity supplier targeting small and medium-sized enterprises, has found that despite fuel prices doubling in the past year, businesses are doing little to cut their energy bills.

With energy prices on the rise month on month for the past 22 months and wholesale costs now double what they were last year, households and businesses are paying more than ever for gas and electricity. As a result, a growing number of people are living in what the media and government have termed "fuel poverty", a new buzzword to describe those spending more than 10% of their income on fuel bills. But while the focus has largely been on pensioners and families, small and mid-sized businesses are also feeling the pinch.

To find out how hard businesses are being hit and what they are doing to cut their fuel bills, Electricity4Business recently commissioned an independent, nationwide survey of SMEs' energy usage. The findings are worrying: many small businesses are actually in a worse state than consumers. Almost one in five small companies polled now suffer from fuel poverty with energy bills making up their second biggest cost.

"Traditionally, fuel bills have not always been at the top of the agenda for SMEs and owners with little time on their hands have been happy to assume that prices are comparable across the board," says Graham Paul, Sales and Marketing Director of Electricity4Business, an independent supplier of cheap electricity competing with the UK's six major energy suppliers. "Increasingly, however, small businesses are being forced to reassess their attitude to fuel costs. A sandwich bar with several refrigerators used to paying an annual 1,800 for electricity will have to sell a lot more sandwiches to meet this year's electricity bill of 3,600."

So while increased fuel costs are eating into profits, what are businesses doing to cut their bills? The answer, according to the survey, is very little. Some 18% polled say they simply "pay the bills" and almost a third do not understand the breakdown of their electricity bill.

More worryingly still, the survey showed that over half of businesses owners have never read the small print of their electricity contracts. According to Paul, this makes them vulnerable to exploitation, giving the "big six" energy suppliers free rein to hike prices and lock customers into expensive long-term contracts.

Jonathan Elliott of B2B comparison website MakeItCheaper.com agrees: "By understanding their contracts and benefiting from the support available from alternative suppliers and industry bodies, businesses can reduce the financial impact of high energy bills."

As one of these alternative suppliers, Electricity4Business positions itself as the champion of the small business - not only by offering fair and transparent pricing, but also by providing advice to customers on energy efficiency. "Sadly, our survey shows, we still have a long way to go to convince businesses that there is a cheaper way. But with wholesale prices soaring, the case for switching to a supplier like E4B is stronger than ever," he adds.

A summary of the survey can be downloaded in pdf format from www.electricity4business.co.uk. The document concludes by outlining five ways in which businesses can cut their fuel bills, from shopping around and reading the small print of contracts to switching suppliers and improving energy efficiency in the workplace.
About the Author
Headquartered in Milton Keynes, Electricty4Business (E4B) is a supplier of cheap business electricity for the small and medium sized business market. UK Media enquiries, please contact: Emma Churchill Electricity4Business t. 08701 630830 e. echurchill@electricity4business.co.uk Lisa Boustead / Nick Clark Nelson Bostock Communications t. 020 7229 4400 e. lisa.boustead@nelsonbostock.com
Please Rate:
(Average: Not rated)
Views: 113
Print Email Report Share
Article Categories