Business energy customers should make a note in their calendar of 1 April 2017 – significant changes are afoot. With the introduction of P272 legislation, their electricity bills are about to get a great deal more complicated.
From the start of April 2017, business energy bills will be calculated in a completely different way. Instead of an annual reading, electricity meters will automatically send a reading every half an hour to the supplier, so energy retailers will be calculating business customers’ new energy bills based on an extra 17,519 readings a year – or 17,567 in a leap year.
The chances are that most businesses are currently on a 05-08 electricity meter, also known as a max demand meter. Energy companies calculate the bill based on one yearly reading; after fiddling about with the numbers, they eventually land on something that looks like the business’s bill.
While this might make for an easy-to-read utility bill, it doesn’t give the customer an accurate picture of when they use electricity. The biggest thing business customers will notice is that their bill is about to get very confusing. And while they might be able to take advantage of off-peak power like never before, it also means they could get stung by peak prices.
It gets more complicated when you consider that each energy supplier will roll out this switch in a different way, and there are currently no set standards for peak times.
As of 5 November 2015, all businesses using an automated and accredited electricity meter within the 05-08 class were switched to HH billing. However, those outside of this remit will be switched over on or before the 1st April 2017. For many businesses, this means budgeting for a hike in prices in 2017. Charges will vary at different times of the day, so the 3pm tea break could soon get a little pricier.
That said, companies with atypical office hours could see a fall in their energy bills, as they will be able to make the most of the offpeak
power. Another factor will be the additional charges for managing this new billing process, which the energy companies will be passing on to the business customer.
A company’s fancy new smart meter will require a meter operator and a data collector, so if businesses don’t want to risk getting lumbered with one appointed by their utility provider, they will need to shop around for the best deal.
Change can be a good thing, provided that businesses are well prepared for it. As we all know, knowledge is power. So while customers might not be able to make head nor tail of bills calculated on half-hourly meter readings, in the right hands the data that it contains could be very compelling.
Given their stronger understanding of how businesses use their energy, a business energy broker could be in a better position to negotiate with energy suppliers on behalf of business customers.