There are so many costs to consider when running a company, and it’s easy for things to spiral out of control, or slip through the net.
From your business energy bills through to your employees’ wages, keeping the books balanced can be a thankless task. This is especially true if you rent a commercial space and looking to save on your energy.
For many companies, renting is the only option, and the fact that there is a lot of uncertainty in the commercial property market currently, in part due to the impact of the COVID pandemic during 2020, has not necessarily made things easier for business tenants.
It’s imperative, therefore, that business owners are constantly looking for new ways to streamline their outgoings. This means finding simple and easy ways to be more efficient with the business outgoings and a great place to starts is saving on business every. A lot of businesses mistakenly believe that because they don’t own their property outright, they are powerless to make changes that help to reduce costs.
Love Energy Savings is here to dispel that myth.
Can commercial renters influence energy efficiency improvements?
Interestingly, the report revealed that 27% of enterprises that rent their premises felt they had no say on the energy-efficiency measures deployed throughout their building.
This is a worryingly high percentage.
Gab Barbaro, Managing Director of British Gas Business, summed things up by saying:
“It’s clear from this research that businesses in rented and leased premises need more help from their commercial landlords, and new regulations to tackle the least energy-efficient premises can’t come soon enough.”
It’s important to read through your business property lease to fully understand who is responsible for the energy. If you as the tenant has been paying, you are free to switch your business energy to a more suitable tariff.
What can my business do to address energy inefficiency?
In the UK there is already legislation, such as the Minimum Energy Efficiency Standards (MEES) regulations, in place to tackle inefficiency in rented buildings
MEES prevent property owners from renting outbuildings that fail to achieve a minimum ‘E’ energy-efficiency rating as of 2018. That’s the good news. The bad news is that as many as one in five commercial properties could currently fall into the ‘F’ and ‘G’ categories, according to a study by Cushman & Wakefield.
If you have concerns about the energy efficiency of your business tenant energy, discuss this with your landlord or property manager. Large commercial property management companies are increasingly being judged on their environmental impact. It’s therefore likely that they could be receptive to any eco-friendly measures that you suggest. You can ask to see the property’s Energy Performance Certificate and if the property falls below agreed standards ask what measures are going to be taken to address the issues raised.
Is it possible to switch energy supplier in a rented building?
This is where a lot of business renters (and domestic renters for that matter) really come unstuck.
Just because you don’t own the property outright, it doesn’t necessarily mean that you can’t find the cheapest business energy tariff for yourself.
Depending on your tenancy agreement, you may be responsible for paying the bills to your energy supplier directly, or your landlord may be directly responsible.
Many businesses are on expensive roll-over tariffs and could dramatically reduce the amount they pay by finding a cheaper business energy contract. You need to inform your landlord if you intend to switch energy supplier. A switch may require a new meter installation, such as a half-hourly meter, which would need your landlord’s permission.
If your landlord is responsible for paying the energy bills directly, you could explore with them finding a cheaper tariff for your needs. It might be the case that the owner of your building has already factored energy costs into your overall bill. They may have an agreement in place with a supplier and therefore be reluctant to switch. That is why it is important when you sign a lease agreement to clarify who is responsible for the energy bills!
Phil Foster, Managing Director at Love Energy Savings, explains the situation:
“If a tenant is responsible for the meter, they can dictate the supplier. In a serviced office, the landlord agrees the contracts and recharges the cost to tenants.
“Landlords are responsible for unoccupied space and therefore it is in their interest to obtain the best possible rates. Plus, there is generally a sub-clause that states the landlord will make the best effort to secure a fair deal for their tenant.”
If you're responsible for managing the energy bills at your premises, you can find out how much you could save by completing our quick energy comparison calculator.
Tips for lowering your energy usage as a business tenant
There are many simple changes you can make to your business operations that can lower your energy usage.
- Turn your computers off - It seems obvious, but how many businesses check that they've turned everything off at the end of the day? As a renter, this is definitely something you can control.
- Set a consistent temperature - If you are in a serviced building, it might be the case that the property manager will control the temperature in your office. Make sure you communicate with them and maintain a consistent temperature throughout the day. Also, check that your heating is not used when your office is closed. It's up to you to check!
- Consider the space that you are using - Turning down radiators in rooms that are not in use and reducing any draughts to lower the need for heating can help.
- Don't dismiss flexible working - If your employees are working from home, think of the amount of energy you could be saving in your office.
- Make the most of free expert help - It's always worth keeping an eye out for funds and grant for your business.
Many of the tips in our guide on how to conduct a simple energy audit will also help renters to save cash.
If you require any further advice on how to cut your energy bills in a rented property, our friendly team of experts will be more than happy to help. You can contact our energy experts here.