small business

Life has never been more challenging for a small business owner in 2021. Unprecedented is an overused term but it describes the challenges business owners have faced over the last year. Trying to hold onto customers and clients, support staff, pay bills, reduce costs and keep the business afloat through a pandemic has been the ultimate challenge.

For any business, energy bills are a significant cost that can eat into profits. And just like homeowners, many businesses pay too much for their power. With energy costs so high, reducing energy use and reducing energy bills is an obvious place to start when hoping to manage business costs – but how? 

#1 Seek Energy Efficiency Grants and Loans

The average SME could reduce energy bills by up to 30% by implementing energy efficiency measures. Typically, 10% savings can be achieved with little or no capital cost. Some investment may be required to get the remaining 20% but the payback is generally around 1.5 years.

And the good news is that there are a range of grants and loans available to small businesses looking to undertake energy efficiency projects.  The eligibility criteria for these projects are varied and depend on the size and sector of your organisation but are really worth checking out as they can help with design, feasibility, and the cost of installing energy efficiency measures.

#2 Use resources more efficiently

Let’s start with the obvious. There are lots of simple, straightforward actions you can take that won’t cost anything and will start saving you money straight away. You may be doing some of these things already, while others might be completely new idea

The longer your heating is on and the higher the thermostat is set, the higher your bills will be. But too often timers and thermostats are installed and forgotten about. Set times and temperature to suit working patterns so heating is only on when needed. Heating costs increase by around 8% for every 1 degree increase, so turning  it down 2 degrees would save around £160 on a £1,000 bill.

Seal up any draughts, unused doors or flues…up to 30% of heating costs can be saved by preventing cold air entering a building, so controlling this is one of the simplest ways to reduce energy bills

For many businesses lighting is one of the most energy intensive parts of the business and can be responsible for up to 40% of a building’s electricity use. However, a few small changes can significantly reduce your costs. Beyond switching off lights when they’re not needed, there are a number of other easy-to implement measures you can take control over your lighting costs. Installing timers and sensors are an excellent low cost solution – occupancy sensors alone could cut energy use from lighting by 30%. This is especially important for areas that are often left unoccupied, that only require lighting when it’s dark, or even for just making sure everything gets turned off at the end of the day. Don’t forget external flood lights can be very expensive – a single 500w flood light will cost around £250 a year if it’s left on for 12 hours overnight

If a piece of office equipment isn’t being used, make sure to switch it off – you’re only paying for energy which isn’t being used. 46% of electricity in businesses is used outside of standard operating hours. Even leaving equipment on standby can still be a big waste – each little red dot indicating an item on standby costs around £1 per year for every watt of power used. It all adds up and can make a noticeable difference to your energy bill. Ask staff to get into a habit of switching computers off. You can save a lot per year if you stop relying on standby mode – even for an average household, this can reduce bills by £80 a year – so for a business, this could be much more.

#3 More home working

Undoubtedly, work has changed as a result of Covid-19. It is likely more people will work from home, or blended working between home and the office will become the norm. Many companies, such as Google, Twitter and Uber, have reported that staff are far more productive working from home, and they save costs in utilities when they don’t maintain office space. If large and complex enterprises can work from home, it may be that your business can find a balance between office and home working which could mean you reduce office costs including energy bills.

Employees may be able to claim tax relief on the additional costs of working from home, including electricity, heat and broadband and other vouched expenses where they are “wholly, exclusively and necessarily” part of your work.

More information on the eligibility criteria is available in the Revenue’s Tax and Duty Manual on e-Working and Tax .

With reliable video conferencing, high-speed broadband and the option to use a virtual private network to keep your IP safe, there may be no need to be physically in the workplace, or at least all of the time. 

#4 Switch suppliers

When a business uses a lot of energy being on a wrong, expensive tariff can add up to a lot of wasted money. Business energy tariffs can be difficult to understand and compare. There are different meter types, tariff rates, security deposits, terms and charges to consider. If your business has been on the same tariff for a while, then it’s unlikely you are on the best deal – and simply switching can help cut costs

How much your business could save by switching energy suppliers depends on its size, the number of staff and, ultimately, how much energy you use. On average, Power to Switch helps save businesses 11% off their energy bills, which is your money put directly back into your business.


Improving energy efficiency and reducing energy use is a win:win for your business.

As well as reducing energy bills, it helps reduce your carbon footprint. Increasingly environmental performance is ranking alongside economic performance in determining the success and impact of any business. And with support available in terms of energy efficiency grants, and tax credits making an investment now will prove the right decision.

Aodhan O’Donnell is the founder of Power to Switch, a free to use, independent price comparison service for home energy in Ireland. 

Small business cost reduction stock image by Jirsak/Shutterstock