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Commercial Electricity

Updated: 01/23/2024

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Rising electricity costs are a significant challenge for companies aiming to keep costs under control. Commercial energy rates are substantially higher than residential – nearly double on average.

However, companies can take proactive steps to minimize utility expenses. One of the best ways is to compare rates across providers rather than accept high default commercial electricity rates. ElectricityRate.com’s new Energy Marketplace allows commercial energy shoppers to compare up-to-date and reputable electricity providers, plans, and prices easily.

The small time investment to find better commercial electric plans is worth the monthly power bill savings (up to 20%).

What Are Commercial Electricity Rates?

Commercial power rates are the price businesses pay for power. On average, commercial electricity bills are nearly twice as expensive as residential bills!

The reason comes down to electricity usage. Keeping large buildings open and running takes a lot more electricity. Special equipment and machines also use more power. Commercial spaces also often have higher “demand charges”- fees based on the maximum power drawn at once.
In many states, you can compare business electricity rates from different providers. This makes it easier to find good deals and cheaper plans. Saving money on energy leaves more funds to grow your business.

So businesses shouldn’t just accept high electric bills. Take some time to explore lower commercial electricity rates through online marketplaces.

What To Look For When Comparing Business Energy Rates

There are over 20 million businesses in the United States. 90% of these are small, employing less than 500 people. While their electricity consumption varies, the southern states like Arizona or Texas consume about 30% more than the northeastern states.

When searching for the best business electricity rates, here is what to consider:

  • Company Reputation: Choose established providers known for good service. A 2022 survey found that 76% of small businesses rank reputation as the most crucial factor when choosing an electricity provider.
  • Rate Plan Types: Understand if rates are fixed or variable. Some plans offer green energy. 65% of businesses prefer fixed-rate electricity plans to hedge against market volatility.
  • Prices in Your Area: Check if the proposed rates are better than local averages. Commercial rates in 2022 were 10-20% lower in deregulated vs regulated electricity markets (EIA data).
  • Contract Length: Longer contracts, like 1-3 years, often have cheaper rates but less flexibility. A 2021 survey showed 36% of businesses prefer 1-year contracts while 21% opt for 3-year for lower rates.
  • Online Comparisons: Marketplace sites let you easily view and compare many plans in one place. One study found that 75% of commercial rate shoppers succeeded in saving money using energy marketplaces.

The key is checking all these factors for the most affordable and reliable business electricity. Comparing rates from just a few top providers can save 20% or more!

Setting Up Electricity Service for Your Commercial Business

New Businesses

Establishing electricity service for a new business can be challenging because pricing is usually determined by usage, load factor, and demand. The electricity supplier might find it difficult to calculate your electricity pricing since you are just starting.

Here is what to do instead:

  • 1. Calculate electricity usage based on occupancy rate, customer demand, square footage, and business category.
  • 2. If your business credit is new, search for providers with flexible credit options or who accept personal credit checks.
  • 3. Ask your landlord or builder to check if a city permit is required for electricity in your new space.

Established Business

The types of utilities your business requires depend on the nature and type of your operation. Each state has its own regulations. Most small businesses with a physical building and on-site employees must provide electricity and running water.

  • 1. Identify the utilities your business needs based on its nature and type of operation.
  • 2. Research state-specific regulations for electricity and water services.
  • 3. Google “how to set up electricity service for my business in [Insert your state]” for a detailed process breakdown.
  • 4. Contact the local Department of Energy for information on small business energy programs and requirements.

Renewable Solutions For Your Commercial Business

With a renewable energy electricity plan, you can get a portion or even the entirety of your electricity supply from renewable sources. This can help your business hit sustainability goals and show that your organization cares about its carbon footprint.

There are a few ways that electricity providers go about this.

  • Renewable Energy Credits (RECs) REC’s Support green energy generation by offsetting power usage with more green power entering the grid.
  • Direct Source Renewables Allows businesses to procure renewable electricity from renewable power generators in the area.
  • On-Site Solar Install solar panels that supply renewable electricity directly to your business.

Energy Efficiency Solutions For Commercial Businesses

While managing your business’s energy consumption can be a great way to cut your energy expenses, it’s not the only way. Retail electricity providers offer energy efficiency solutions that can help lower a business’s total energy consumption and energy bills.

To increase a business’s energy efficiency, most providers will start with a business energy audit. This involves an energy technician coming out to your business to inspect it. They will then look for inefficiencies in your business and provide recommendations on how to improve it.

Some providers will pay for improvements if your business doesn’t have the capital for the upfront costs. The company can then pay for these improvements through payments on its energy bill. After it’s paid off, your business can reap the cost savings provided by the energy efficiency improvements.

Natural Gas Solutions For Commercial Businesses

Customization does not stop at the electricity bill. If your business uses a lot of natural gas, there are natural gas plans you can tailor for your business’s needs as well.

As with finding the right electricity plan, getting the perfect natural gas solution for your business is all about understanding its energy consumption. Your energy expert will likely ask similar questions to the ones listed in the previous section.

From there, you can examine natural gas plans ranging from fixed pricing to index pricing to everything in between.

Introducing Electricity Rates Energy Marketplaces

Our online energy marketplace helps business owners easily compare commercial electrical providers to find the best business energy rates.

Just put in your ZIP Code to see rates from suppliers in your area. Marketplaces let you shop and switch providers fast. Studies show that 75% of commercial users save by comparing rates across marketplaces.

Commercial Electricity Rates Key Takeaways

Learning the ins and outs of commercial electricity rates can seem complicated. But, instead of sticking with the default expensive rates, take charge by comparing plans online. Leveraging electricity rate marketplaces simplifies finding the most affordable electricity tailored for your business.

The ElectricityRates.com marketplace makes comparing electricity companies and commercial rates in your local area easy. Why settle for inflated utility costs when competitive business electricity plans may reduce your company’s energy spending by 20% or more?

You can also get an easy-to-read report on your best commercial power provider options for your goals and building type. Enter your zip code so you can discover your energy cost savings today!

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FAQ's About Commercial Electricity

How do I pick the best electricity company?

Consider reputation, plan types, contract lengths, and prices in your area. Comparing rates and reviews helps find the best fit.

What are the cheapest commercial electricity rates?

Fixed-rate, longer-term plans usually offer the most savings and protect you against energy market fluctuations. Marketplace quotes help you estimate potential savings from switching.

Why are business energy bills higher?

Commercial spaces and equipment use more electricity overall, leading to higher rates. Shopping for better pricing can offset these costs.

Is it worth comparing electric plans?

Yes! Rate discrepancies are common among commercial providers. And many commercial electrical companies offer promos or new member discounts. Comparing rates could save your business 20% off high electric bills.