Shop business energy: what retailers pay

A shop's energy bill is driven by two things above all: how long the lights and displays are on, and whether you sell anything that needs to stay cold. This guide covers retail energy costs, the thresholds that decide your protections, and where shops usually find savings.

What uses the energy in a shop

• Refrigeration. For a convenience store, newsagent or food shop, chillers and freezers run all day and all night. Open-fronted chillers are particularly hungry because they cool the air around them.
• Lighting. Bright shop-floor lighting and window displays, often on from before opening to well after closing.
• Heating and air conditioning. Doors open to the street let heat out in winter and in during summer.
• Tills, card machines, security and signage. Small individually, but always on.

A clothes shop or gift shop with no refrigeration has a much smaller bill than a food retailer of the same size. Do not compare bills across shop types without allowing for that.

Worked example: a corner shop with chillers

Take an illustrative convenience store using 90,000 kWh of electricity a year. We use the Moneysupermarket Business figures for small-business fixed deals in October 2026 as a guide (27.2p/kWh and 118.9p/day); they are indicative averages from a comparison site, not an offer, and the page has some internal inconsistencies, so your quote will differ.

Line	Calculation	Cost
Energy	90,000 × £0.272	£24,480.00
Standing charge	365 × £1.189	£433.99
Climate Change Levy	90,000 × £0.00801	£720.90
Subtotal		£25,634.89
VAT at 20%	£25,634.89 × 0.20	£5,126.98
Total		£30,761.87

If better lighting and chiller management cut usage by 10%, that is 9,000 kWh. The saving is 9,000 × (£0.272 + £0.00801) = £2,520.09 before VAT, or £3,024.11 including VAT. Use the cost calculator to test your own figures.

Are you a microbusiness?

This example shop sits just under the 100,000 kWh a year electricity test for a microbusiness. You can also qualify with fewer than ten employees and turnover or balance sheet of no more than €2 million. Hitting any one test is enough, and you can be a microbusiness for one fuel only. Why it matters: microbusinesses get clear Principal Terms, broker commission shown in the contract, limits on notice, and a 12-month cap on backbilling. Larger shops are still covered by the Energy Ombudsman if they are "small business" (fewer than 50 employees and turnover up to £6.5m, or balance sheet up to £5m, or electricity up to 200,000 kWh).

Rented shops and shopping centres

Many shops do not hold their own energy contract. If you are in a shopping centre, an arcade or a unit where the landlord sub-meters you, the landlord is reselling energy to you. Ofgem's cap on resale prices currently applies only to domestic use, so for a shop the lease sets what you pay; ask to see how the charge is worked out. If you have your own meter, you have your own contract, and if you move into a unit without agreeing one you can end up on a deemed rate. Before signing a lease, ask for the unit's last 12 months of bills and its EPC, since poor energy performance means higher bills; see EPC and MEES.

Cutting retail energy use

Refrigeration

• Fit doors or night blinds on open chillers if practical.
• Don't overload them or block the air vents.
• Clean condensers regularly. Dust makes compressors work harder.
• Don't place chillers where the sun or a heater hits them.

Lighting

Swap fluorescent and halogen lamps for LED, and use timers so window lights switch off when the street is dark and empty. See LED lighting for business for how to judge payback.

Doors and heating

Keep the door shut where you can, use a door curtain or porch, and set heating to the opening times. A smart or advanced meter will show you where your usage jumps.

Contract choices for shops

Most shops want predictable costs, so a fixed term makes sense, but check the end date: a renewal that rolls over for up to 12 months can lock you into a price you didn't choose. Read business energy renewals and contract terms to check. There is no cooling-off period on business contracts, so take your time with a doorstep or phone offer.

How shop types differ

Shop type	Main energy drivers	What to watch
Convenience / food	Chillers, freezers, long hours	Overnight base load; chiller maintenance
Clothes / gifts	Lighting, heating, displays	Window and spotlight hours; door heat loss
Newsagent / off-licence	Chillers, lighting, late opening	Late-night trading hours add up
Hardware / larger units	Space heating, high-bay lighting	Volume of the building; possible half-hourly meter

Gas in a shop

Many shops have no gas at all and heat electrically. If you do have gas, it is a separate contract and a separate standing charge, even if the supplier is the same. Gas is cheaper per kWh than electricity, so check whether a gas-heated shop saves you money against an electrically heated one over a year. For the unit-rate differences see business gas prices per kWh and business electricity prices per kWh.

Trading peaks and quiet periods

Shops with seasonal trade, such as a gift shop in a tourist town or a toy shop in the run-up to Christmas, have a lumpy year. The standing charge is the same all year, so a quiet month with an unchanged bill is not necessarily an error. Equally, estimated bills can bunch up; give your supplier regular meter readings and check any bill that looks wildly off against your last reading. If you think a bill is wrong, our guide to disputing a high business energy bill shows the order to do things in.

Next steps

1. Check whether the energy contract is in your name or your landlord's.
2. Total 12 months of kWh and cost, and divide cost by kWh to find your all-in price per kWh.
3. Find the overnight base load with two readings, close and open.
4. Put the contract end date in the diary.