Average business energy bill: what small UK businesses typically pay

The honest answer to "what is the average business energy bill?" is that a single number is not very useful. A one-person office and a 40-seat restaurant are both "small businesses" but their bills can differ five-fold. This page gives typical ranges by size, shows how to build your own estimate, and explains why your figure may be higher or lower.

Typical usage by business size

A comparison site's October 2026 consumption guide, which uses Ofgem-style size bands, gives these rough averages (treat them as indicative, not an official statistic):

Size	Electricity (kWh/year)	Gas (kWh/year)
Micro	up to about 15,000	under about 10,000
Small	up to about 25,000	about 25,000
Medium	up to about 50,000	about 45,000
Large	over about 50,000	over about 65,000

Sizes in this table are loose labels, not the legal definitions. For the legal tests (which decide your protections) see what is a microbusiness for energy.

What these usage levels cost

The same publisher's panel average fixed rates for October 2026 were: micro 28.4p/kWh electricity plus 58.0p/day standing charge, and 8.8p/kWh gas plus 44.9p/day; small 27.2p + 118.9p/day for electricity and 8.5p + 49.5p/day for gas; medium 27.7p + 90.1p/day and 8.7p + 67.3p/day. These are averages of what suppliers on its panel were quoting (including the site's maximum commission); the page does not say whether VAT or the levy is included, so we treat them as net prices. I have used them to calculate the following (my own sums, before VAT and before itemised levies):

Example	Sum	Annual cost
Micro, 10,000 kWh electricity	10,000 x £0.284 + 58.0p x 365 (£211.70)	£3,051.70
Micro, 10,000 kWh gas	10,000 x £0.088 + 44.9p x 365 (£163.89)	£1,043.89
Small, 20,000 kWh electricity	20,000 x £0.272 + 118.9p x 365 (£433.99)	£5,873.99
Small, 22,500 kWh gas	22,500 x £0.085 + 49.5p x 365 (£180.68)	£2,093.18
Medium, 40,000 kWh electricity	40,000 x £0.277 + 90.1p x 365 (£328.87)	£11,408.87
Medium, 47,500 kWh gas	47,500 x £0.087 + 67.3p x 365 (£245.65)	£4,378.15

Those are net figures. Most businesses then add the Climate Change Levy (0.801p/kWh from 1 April 2026) and 20% VAT. For the small electricity example, 20,000 kWh x £0.00801 = £160.20 of levy, and 20% VAT on £6,034.19 (£5,873.99 + £160.20) takes the total to about £7,241.03.

The two micro examples are different, because 10,000 kWh a year is about 27.4 kWh a day (10,000 ÷ 365), under the de minimis limits of 1,000 kWh a month of electricity and 4,397 kWh a month of gas. Supplies that small carry no Climate Change Levy and are treated as domestic for VAT: normally 5%, so £3,051.70 x 1.05 = £3,204.29 for the electricity. For electricity supplied in Great Britain from 1 October 2026 to 30 June 2027, HMRC's temporary zero rate applies to these qualifying supplies, so the VAT would be nil (HMRC first announced an end date of 31 March 2027, then extended it). You can rerun the sums with our VAT and CCL calculator.

The official average price

The government's Quarterly Energy Prices release (September 2026) puts the average non-domestic unit price for April to June 2026 at 24.51p/kWh for electricity and 5.28p/kWh for gas including the levy. These are averages over all non-domestic customers, including large users who pay less per unit, which is why they sit below the small-business panel prices above.

What makes your bill higher or lower

• Hours and equipment. Refrigeration, ovens, extraction, heating and air conditioning drive most of the use. See your sector: restaurants, pubs, shops, offices and salons.
• Region. Network and standing charges differ across Great Britain; see why standing charges vary.
• Contract type. Out-of-contract or deemed rates can be much higher than a fixed deal. The same comparison site recorded average out-of-contract electricity of about 40p/kWh in October 2026. See how much more deemed rates cost.
• Meter and profile. Half-hourly meters and day/night splits change the pattern of cost.

Build your own estimate

1. Find your annual kWh. It is on your bill as an annual quantity, or add up 12 months of usage.
2. Multiply by the unit rate in pounds (for 27p, use 0.27).
3. Add the standing charge: pence per day x 365, divided by 100.
4. Add the Climate Change Levy and VAT if applicable.

Or enter your figures into the business energy cost calculator.

If you don't know your usage, ask your supplier for your annual consumption or an annualised figure, which should be on the Principal Terms. See how to calculate annual business energy cost.

Why averages mislead, and a hypothetical comparison

Two businesses can have identical headcount and very different bills. Take two imaginary premises on the small-business rates above (27.2p/kWh and a 118.9p daily charge, which is £433.99 a year):

• A quiet office using 12,000 kWh: 12,000 x £0.272 = £3,264.00, plus £433.99 = £3,697.99.
• A busy kitchen using 45,000 kWh: 45,000 x £0.272 = £12,240.00, plus £433.99 = £12,673.99.

The usage figures are made up to show the gap; the rates are the panel averages. The lesson is that the unit price is only part of the story: usage is the lever you control. Sector pages such as hotels and care homes cover the biggest drivers in each trade.

Gas versus electricity

Gas is much cheaper per kWh than electricity (5.28p against 24.51p in the official Q2 2026 averages), but it is only used for heating, hot water and cooking. A business with no gas supply will not see a gas bill at all. If you heat with electricity, your electricity use will be much higher than the table suggests. See is business gas cheaper than electricity.

Seasonal swings and why a monthly bill can mislead

Gas bills in particular peak in winter, and electricity bills rise in summer if you run air conditioning or cold storage hard. If a supplier is billing you on estimates, a single month can look very high or low. Compare a full 12 months, not one invoice, and check readings are actual rather than estimated; see estimated business energy bills. Cost per kWh over a year is the fairest yardstick.

Is my bill too high?

Compare your effective cost per kWh (total bill, less VAT, divided by kWh used) with the figures above. If it is far higher, look for estimated readings, out-of-contract rates or an old fixed price. Read disputing a high bill and why prices rise at renewal.

Averages describe the market, not what you should pay. A cheaper-than-average rate does not mean a good deal if your usage is also high, and a higher bill may simply mean a busier site.

Next steps

1. Gather 12 months of usage for each fuel.
2. Work out your cost per kWh and compare it with the table.
3. If you are out of contract or near renewal, request quotes now.
4. Look for easy savings: saving energy in a small business.