Get App
How are business energy plans different from household energy plans?
Business electricity and gas plans are generally structured the same as residential energy plans. However, rates may be quite different, as businesses typically use more energy than the average home.
Many residential electricity or gas providers also offer specialised plans for small to medium businesses. A small business typically employs fewer than 20 people, while a medium business can have anywhere from 20 to 199 employees; however, some energy providers may instead classify a business size in terms of its yearly energy consumption.
There are also a handful of energy providers who sell business plans exclusively, such as Blue NRG and Next Business Energy.
How is business electricity charged?
Business electricity plans are broken down into two main charges - usage and supply.
Supply charges
A daily fixed cost you pay (in c/day) to remain connected to the power grid.
Usage charges
A cost in cents per kilowatt hour (c/kWh) for every kilowatt hour (kWh) of electricity consumed.
Business electricity pricing is also determined by the tariff type. A tariff covers how you're charged for your electricity use. Common business tariffs include:
Single rate tariffs
Electricity is charged at a flat rate, no matter the time of day or season. This is generally the standard tariff an energy customer is placed on and doesn’t require additional electricity metering or resources. These charges are often referred to as a ‘peak’, ‘anytime’ or ‘general usage’ rate on your power bill.
Time of use tariffs
Charges different rates for power depending on the time of day, or in some cases, the time of year you are using energy. These charges are generally broken into three sections: peak, off-peak and shoulder.
- Peak time is when customers are charged the most for power usage as it correlates to the greatest demand on the grid – typically between 3pm and 9pm on weekdays.
- Off-peak times are generally the cheapest and are usually in the middle of the day or later in the evening.
- Shoulder times cover all other hours.
Controlled load tariffs
A plan that includes a separate charge for power used by high-usage appliances, such as hot water systems. Typically, this tariff only applies for limited hours in the day and will only measure usage from the nominated appliance.
Demand tariffs
Demand tariffs include three parts: a supply charge, a usage charge, and a demand charge. The demand charge is based on your home's highest electricity usage during peak times.
How are business gas plans charged?
As with business electricity, business gas plans generally include different rates when compared to similar gas offers available to residential customers. Natural gas is heavily used in sectors including manufacturing, agriculture, mining and hospitality, as well as for general heating in businesses across all industries.
Business gas plans are made up of the following main charges:
Gas usage charges
Gas usage charges are measured in cents per megajoule (c/MJ). These rates are usually charged as a ‘block rate’, which means the rates either reduce or increase as more gas is used. This is measured in usage blocks.
Gas supply charges
Gas supply charges are the daily cost to remain connected to the mains gas network. Supply charges are generally measured in cents per day (e.g. 70 cents per day) or as a total sum amount for your billing period (e.g. 90 days). You will be billed for supply charges regardless of how much gas you use.
Across both electricity and gas, business energy plans may also come with additional charges:
- Move-in/new connection and disconnection fees
- Early exit fees (on contracts)
- Credit card surcharges
- Dishonour fees
- Paper billing fees.
Some plans may also offer opt-in extras such as carbon offsets, which come at an additional cost outlined on your bill.
How to find a good electricity deal for your business
With electricity being a major expense, business owners must know what to look out for when picking an electricity deal. According to Canstar research conducted in June 2025, only 25% of Aussie business owners believe they are on a good energy deal.
Here's how Aussie businesses can ensure they're not overpaying for electricity:
- Compare business electricity plans: Do your research and compare the usage and supply rates on different plans against each other to ensure you are paying the best price.
- Look for incentives: While sign-up credits and incentives might not be for everyone, they could help your business lower your electricity costs. Always check if the discounts offered are guaranteed or conditional, with the latter requiring specific criteria to be met. Discounts and incentives may also be masking inflated electricity rates, so it's important not to look at discounts on their own.
- Determine whether fixed or variable rates would be better: Some retailers may offer the option of fixed or variable rates on their business electricity deals. While fixed rates offer the security of locked-in rates for 12 or 24 months, variable rates allow access to cheaper rates should prices change for the duration of your contract.
- Look into solar panels or batteries: Canstar found that around 10% of Aussie businesses had recently installed solar to help reduce their energy costs. These businesses can become less reliant on the grid and potentially offset higher energy costs with solar feed-in tariff (FiT) payments.
- Switch energy providers: If the electricity plan your business is currently on isn’t cutting it, it may be worth switching your energy provider. Only 12% of Aussie business owners said they had switched providers in the last two years.
Reducing how much electricity your business uses
- Understand what uses electricity in the business: Determining what equipment in your business uses electricity will help to gain a rough idea of what your energy usage habits currently look like.
- Monitoring tools and software: Electricity usage monitors, smart meters, digital meters or energy monitoring software are great tools to keep track of your energy usage. They can be used to set up usage alerts, identify areas of high energy usage and track solar output for solar customers.
- Join a demand response initiative: For larger businesses, it may be worth looking into whether their electricity provider runs a demand response initiative that they can take part in. Through this initiative, business customers essentially reduce their electricity usage in times of high demand to help ease strain on the grid. Not only would this help businesses reduce energy usage, but they will also be financially rewarded by their provider for doing so.
What is the average business electricity bill?
Recent Canstar data revealed that the average quarterly electricity spend for Australian small businesses is about $832. Please note that average pricing in your area may differ significantly.
State or Territory | Average Quarterly Electricity Spend |
|---|---|
New South Wales | $901 |
Victoria | $798 |
Queensland | $871 |
South Australia | $686 |
Western Australia | $770 |
Tasmania | $816 |
Australian Capital Territory | $816 |
Northern Territory | N/A |
Source: Canstar research, June 2025
How much electricity does a business use?
According to Energy Consumers Australia, a small business may use between 13,000 and 32,000 kilowatt hours (kWh) of electricity per year, on average (depending on its location, distribution network and the type of tariff).
It’s important to note that electricity usage will vary from business to business based on factors such as size, hours of operation, energy efficiency and overall power usage needs.
What uses the most electricity in a business?
Depending on the type of business you run, there will be different tools and equipment that use more energy than others. For a typical office space, you can expect these items to contribute the most to your business energy use:
- Air conditioning
- Heating
- Lighting
- Computers, laptops and printers
- Internet routers and modems
- Refrigerators and dishwashers.
Which industry uses the most electricity?
In Australia, the manufacturing industry typically consumes the most electricity, using around 52,461 gigawatt hours (GWh) over 2017-2018, according to the Australian Bureau of Statistics (ABS).
The mining industry is the second highest, using 23,424 GWh, followed by the electricity, gas and water sector with 6,543 GWh.
The construction industry is claimed to use the least amount of electricity in Australia, only totaling around 2,138 GWh a year.
How does business electricity use change throughout the seasons?
According to Canstar's research, 21% of Australian businesses typically use more electricity during the summer months. Queensland and Western Australia each reported the highest numbers, with 30% of businesses consuming more electricity throughout summer. Less than one quarter of participants (22%) revealed that their businesses used more electricity during winter. Tasmanian businesses reported the highest rates of winter usage at 36%.
