British businesses could see their energy costs rise by 125 percent this winter, as they are not included in Ofgem’s price cap which limits household bills.
The average household in the UK benefits from an energy price cap that is currently set at £1,277 per year., although the price cap is expected to increase substantially next Spring.
However, businesses are not included in the price cap whatsoever, and face being rolled onto out-of-contract rates by energy suppliers aiming to cover the losses from spiraling wholesale energy prices.
As there are over six million small businesses (SMEs) in the UK, accounting for around 99 percent of all businesses nationwide, there are growing fears that many businesses could struggle to pay their bills over the coming months.
Alex Staker, head of commercial operations at business comparison specialists Bionic, believes that small businesses suffering from increased energy costs should contact their supplier and look to negotiate a way forward.
He explained: “Your supplier may be able to work with you to find a suitable solution such as, a review of your payments or debt repayments, payment breaks or reductions, more time to pay or access to hardship funds.”#
Alongside the possibility for a compromise over payments, he also encouraged SMEs to reduce their overall energy usage to save money. He suggested installing energy-efficient light bulbs, smart-meters and turning off electronic devices when not in use.
Meanwhile, business secretary Kwasi Kwarteng has asked the government to provide more financial support to struggling energy firms.