As of July 2026, most UK small businesses on a negotiated fixed contract are paying roughly 23–30p per kWh for electricity and 7–9p per kWh for gas, plus a daily standing charge. Businesses that have rolled off a fixed deal onto deemed or out-of-contract rates typically pay far more — around 33–45p for electricity and 10–14p for gas. Below is what those numbers mean, and how to tell where you sit.
Key takeaways
- Business energy has no Ofgem price cap — the domestic cap does not apply to commercial contracts.
- The single biggest overpayment is rolling onto deemed / out-of-contract rates when a fixed deal ends.
- Your exact rate depends on meter type, region, consumption, contract length and the wholesale price on the day you fix.
- On the same meter, the gap between the best and worst deal on the market is often 30–50%.
- A benchmark against the whole market is the only way to know if your rate is fair.
How much does business energy cost in 2026?
The table below shows indicative unit-rate ranges for UK business energy as of July 2026. These are market ranges to benchmark against — not a quote. Your actual rate is set when you fix a contract and depends on the factors listed further down.
| Negotiated fixed | Out-of-contract / deemed | |
|---|---|---|
| Electricity (per kWh) | 23–30p | 33–45p |
| Gas (per kWh) | 7–9p | 10–14p |
| Electricity standing charge (per day) | 40–60p | 55–80p |
| Gas standing charge (per day) | 30–50p | 45–70p |
The 60-second bill test
Pull your latest bill and look for the words "deemed", "variable", "rollover" or "out of contract". If any of them appear, you are almost certainly on the most expensive rate your supplier offers — and a benchmark will very likely beat it.
Business electricity rates per kWh
Business electricity is priced in two parts: a unit rate (pence per kWh you use) and a standing charge (a fixed daily cost to keep the supply connected). In 2026, a typical small business fixing a new contract is seeing electricity unit rates in the 23–30p range, with the exact figure driven mostly by consumption, region and contract length.
The number that catches businesses out is the out-of-contract rate. When a fixed deal ends and nothing new is agreed, suppliers move you onto deemed rates that commonly sit at 33–45p per kWh — often 40–80% above what the same business could fix today.
Business gas rates per kWh
Business gas is cheaper per unit than electricity. In 2026, negotiated fixed gas rates are broadly 7–9p per kWh, with a daily standing charge on top. Deemed and out-of-contract gas commonly runs 10–14p per kWh. Gas standing charges are usually lower than electricity, but rise sharply on out-of-contract terms.
What about standing charges?
The standing charge is the part of the bill you pay even if you use nothing. It covers the cost of maintaining your connection to the network and varies by region (your local distribution network sets part of it) and meter type. A low headline unit rate paired with a high standing charge can work out more expensive overall than it first looks — always compare the two together, not the unit rate alone.
Business energy rates by business size
Larger consumers generally secure lower unit rates, because suppliers spread fixed costs over more usage. The bands below are indicative fixed electricity ranges for July 2026.
| Business size | Approx. annual usage | Indicative fixed rate |
|---|---|---|
| Micro | Up to ~15,000 kWh | 26–31p per kWh |
| Small | ~15,000–30,000 kWh | 24–29p per kWh |
| Medium | ~30,000–100,000 kWh | 23–27p per kWh |
Why business energy has no price cap
Ofgem's energy price cap applies to domestic customers only. Business energy contracts are not capped — the rate you pay is whatever your contract says, or, if you have no contract, the deemed rate your supplier chooses. That is exactly why letting a fixed deal lapse is so costly for a business: there is no safety net catching the price on the way up.
Deemed and out-of-contract rates: the expensive default
If your fixed contract ends and you do nothing, you fall onto one of these:
- Deemed rates — the tariff you are placed on with no contract at all (for example after moving into new premises). Typically the most expensive rates a supplier offers.
- Out-of-contract / rollover rates — where your old fixed deal expired and you were moved onto a default variable rate.
- Variable rates — rates that move with the market, with no fixed price certainty.
All three usually cost more than a negotiated fix. Getting off them is the fastest saving available to most businesses — and it is often possible to renegotiate with your existing supplier rather than switching away.
What actually determines your rate
- Consumption — higher, steadier usage generally earns lower unit rates.
- Contract length — longer fixes can smooth out price spikes, shorter ones give flexibility.
- Region and meter type — your distribution network and meter class affect both unit rate and standing charge.
- Wholesale price on the day you fix — business rates track the market, so timing matters.
- Your credit profile and payment method — these can affect the price a supplier offers.
How to get a better business energy rate
- 1Find your contract end date — you can usually secure a new deal months in advance, before you drift onto deemed rates.
- 2Benchmark your current rate against the whole market, not a single supplier or one comparison site.
- 3Compare the unit rate and standing charge together, plus any contract terms.
- 4Renew early. The worst outcome is doing nothing and rolling onto out-of-contract rates.
How we source these figures
The ranges above are compiled from published UK market data (including Ofgem and DESNZ figures and independent market trackers) and our own view of live supplier pricing. They are indicative market ranges for benchmarking, not live quotes, and are reviewed monthly. Last updated July 2026.
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Get my free benchmark reviewFrequently asked questions
What is a good business electricity rate in 2026?+
As of July 2026, a competitive fixed business electricity rate is broadly in the 23–30p per kWh range for a small business, plus a daily standing charge. Larger consumers typically secure the lower end. If you are paying above this — or you are on a deemed or out-of-contract rate — you are likely overpaying.
Why is my business energy so expensive?+
The most common reason is that a fixed contract has ended and you have rolled onto deemed or out-of-contract rates, which are usually the most expensive a supplier offers. Business energy also has no Ofgem price cap, so there is no ceiling on what you can be charged without a contract in place.
Is business energy covered by the Ofgem price cap?+
No. The Ofgem price cap applies only to domestic customers. Business energy contracts are not capped, which is why letting a fixed deal lapse onto deemed rates can be so costly.
Can I switch business energy supplier mid-contract?+
Generally you cannot switch until your current fixed contract is near its end, but you can usually agree a new deal in advance to start when your current one ends. If you are already out of contract, you can move at any time.
How often do business energy rates change?+
Business energy rates track the wholesale market and can move daily. That is why the rate you are quoted depends on the day you fix, and why benchmarking close to your renewal date matters.
About this guide
The mybusinessdeals energy team benchmarks UK business gas and electricity contracts against the whole market.