Small businesses wasting £500m in energy costs


By Kirsty Topping

SMALL businesses in Scotland are wasting 500m on energy every year, a report claimed.

Businesses end up paying more than necessary because they fail to keep track of information such as who their supplier is or when their contract is due for renewal.

This means they could end up paying up to 200% more than necessary on

“out of contract’ rates.

Energy brokers Saturn Energy looked at energy usage at 750 small and medium sized enterprises (SME’s) from Scotland and came to the conclusion that 70% were paying too much for their energy.

Saturn Energy’s Managing Director, John McShane, explained:

“Many SMEs have been hit with increases in production costs, VAT and fuel at a time when the economy is really struggling to recover.

“The fact that 70 per cent of those businesses could be paying too much for their gas and electricity, simply because they don’t keep a track on basic information, is frightening. “

The figure was calculated as a 35% increase on a moderate energy bill of 2000, however Mr McShane added:

“This is a conservative estimate and the true figure could potentially be even higher. “

He also warned of the wider effect on businesses which are overpaying.

“Even a small business, such as a newsagents or a corner shop, can spend 1,500-2,000 a year on energy,’ he said.

“So a 35 per cent increase in costs can have a major impact on their profitability, ultimately threatening jobs and even risking the closure of the business.

“It’s the business equivalent of not seeking out the best car insurance or forgetting who your home and contents insurance is with but it can have a big effect on the profitability of a business. “