Crack the Cost of Living in 2025: 10 Smart Ways to Lower Your Business Energy Costs
Back in 2023 we published a guide on ways for businesses to reduce their energy costs. It was a really popular guide, and little did we know things would only get tougher for businesses so we thought we’d update you on more ways to reduce costs in 2025.
With inflation still biting and energy markets under pressure, 2025 is shaping up to be another year of high business energy costs in the UK. Industrial rates remain among the highest globally, around due to continued reliance on gas-fired generation and extra levies for carbon taxes and renewable infrastructure.
Fortunately, there are practical, affordable steps SMEs and micro-businesses can take to reduce energy costs, stay efficient, and ease the pressure of living and operating in 2025.
1. Pick the Right Energy Tariff – Fix It Before It Fixes You
Variable tariffs leave you exposed to market swings. Fixed-rate contracts shield you from sudden spikes and help with budgeting . Recently, company car fuel reimbursements in the UK dropped, for example, petrol cars from 15p/mile to 14p, highlighting the importance of stable rates.
Action: Compare business energy tariffs quarterly using a broker or aggregator. Lock in a 12–24 month fixed term to avoid unexpected cost increases.
2. Conduct a Simple Energy Audit
Start with a basic audit: check smart meter data, compare month-to-month usage, and identify anomalies like weekend consumption or heating running when no one’s in the office.
Action: Get staff involved in checking thermostats and lighting. Detect outliers, then engage a professional auditor for larger premises.
3. Upgrade to Smart Technology
Smart meters, LED lighting, motion sensors, and smart thermostats can reduce energy usage by up to 10–15%. Smart heating controls alone can save an average of £450 annually for SMEs.
Action: Start with LED lighting; add motion sensors and smart plugs. Consider smart thermostatic radiator valves (TRVs) for localized control.
4. Invest in Energy-Efficient Equipment
Replacing old machinery, appliances, printers, and HVAC units with high-efficiency models can yield long-term savings . This also helps improve your building’s energy rating and access to grants.
Action: Take advantage of Enhanced Capital Allowances and government schemes like the Boiler Upgrade Scheme.
5. Behaviours Matter – Turn It Off, Literally
Encourage staff to switch off equipment at day’s end. Use features that remind or automate shutdown; smart power strips are a cost-effective solution. Recognised simple actions like this can save hundreds annually .
Action: Add “switch-off routines” to your end-of-day checklist. Automate equipment shutdown via smart plugs or timers.
6. Turn to Renewable Energy Tariffs
Green tariffs are increasingly competitive and offer peace of mind by reducing exposure to volatile fossil fuel costs. They’re a viable alternative to variable rates.
Action: Ask your energy supplier about 100% renewable tariffs and weigh them against standard options for pricing and reliability.
7. Install On-Site Renewables and Storage
Solar panels, EV charging stations, battery storage, and even small-scale heat pumps can reduce your reliance on the grid. While the upfront cost is higher, the return on investment often spans just a few years .
Action: Explore funding options through schemes like the Great British Energy Act and local enterprise grants.
8. Monitor Usage Continuously
Energy Monitoring and Targeting (M&T) provides real-time visibility and early alerts of inefficiencies. Even basic dashboards can flag anomalies before they escalate.
Action: Use smart meters and software to monitor, log, and benchmark usage. Share results with your team to build awareness.
9. Consider Deep Retrofits for Long-Term Savings
High-cost retrofit measures, like insulation, double-glazing, or HVAC upgrades, can halve your energy use, improve comfort, and increase asset value .
Action: Plan major upgrades during quiet business periods, prioritising the highest-impact improvements first.
10. Stay Informed About Policy Changes
Zonal pricing, energy market reform, and industry-specific initiatives like the British Industry Supercharger Scheme may offer real savings or grant support, especially if you’re in manufacturing.
Action: Subscribe to Ofgem updates, and join trade bodies for early access to funding and relief schemes.
Your 2025 Energy-Saving Action Plan:
- Compare and fix your tariff
- Perform a DIY energy audit
- Switch to LEDs and smart tech
- Replace old equipment strategically
- Encourage power-down routines
- Opt for a green tariff
- Explore on-site renewables
- Implement usage monitoring
- Plan long-term deep retrofits
- Keep up with UK policy changes
By combining low-cost tweaks (like switching things off and smart heating) with strategic investments (LED upgrades, renewables, monitoring tools), you can lower your energy bills and ease cost-of-living pressures in 2025.
📌 Interested in sustainable growth? Hire freelance energy consultants, engineers, or eco-auditors on PeoplePerHour to help you implement these tips without overloading your team.
