How the UK Energy Market Works

In the UK the energy that is delivered to homes and business may be the same but the market it operates in is very different. It can be noted that business electricity is priced differently as result of various factors. There are several elements that are taken into consideration by power suppliers to determine the tariffs they charge to different customers.

The main reason why power used by businesses is a bit high is that manufacturing firms in particular use more compared to domestic usage. High powered machines are operated for twenty four hours a day and the consumption of electric power is very high unlike domestic appliances which are light.

Heavy duty machinery in different industries requires high electric power voltage and this is one of the factors that contribute to higher prices being charged. The consumption of electricity in firms is a bit higher and this has a bearing on the ultimate price that is charged.

However, not all companies are charged more since other businesses like retail stores consume less power compared to heavy industries. In such a situation, the tariff rates will considerably differ depending on the power that is consumed by the electric gadgets used. Light industries have an option to use prepaid electric power where they can pay per use which is not the case with heavy industries. Power must always be available.

Electric power is often charged according to units that have been used. However, the charge per unit for firms is slightly higher since they use power for commercial purposes. Organizations involved in business are concerned with generating profits and this is the reason why they are charged more per unit. The suppliers of electric power are aware of this and they also need to realize profits from their operations.

Businesses often use electric power for commercial purposes and this is the reason why they pay more for it. Business electricity is a bit expensive because they use more power in order to generate more profits from their operations.


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