Every UK business has always had to keep an eye on its operational costs. Every cost, from hiring people to managing the supply chain, is looked at closely. Electricity is a big and often changing cost that people often forget about. Many companies wonder if the business electricity rates they pay change throughout the day. Yes, it can change, and knowing how to take advantage of this change is the key to saving a lot of money.

It's not new for business electricity rates to change, but many companies aren't set up to take advantage of it. Businesses can save a lot of money on their utility bills by changing when they use energy. This article talks about how electricity prices change, the benefits of off-peak tariffs, and gives UK businesses useful tips on how to use less energy and make more money.

Understanding Business Electricity Rates

Business electricity rates are much more complicated than home energy contracts. They are often made to fit the needs of the business, taking into account things like how much energy is used, when it is used, and where the business is located. Some companies are on simple fixed-rate tariffs, which means that the price per unit (kWh) stays the same no matter when it's used. However, many other companies are on or could switch to time-of-use tariffs.

The idea of "after-hours" rates comes into play with these time-of-use tariffs. Energy companies break the day into different times and charge different amounts for electricity during each of these times. People usually put these times into these groups:

Peak

These are the times when the national grid is most in demand, which is usually during the day when most businesses and homes are busy. This usually happens in the UK between 4 PM and 7 PM, which is late afternoon to early evening. During this time, using electricity is the most expensive.

Off-Peak

These are times when there isn't much demand for electricity in the whole country. Most of the time, this is at night and on weekends. During these times, suppliers offer lower business electricity rates to get more people to use it and keep the grid balanced. For example, off-peak hours could be from 10 PM to 7 AM.

Shoulder

Some tariffs include shoulder periods, which are the times between peak and off-peak hours. The prices here are reasonable, somewhere between the two extremes.

The main point is simple: the grid can only hold so much. This capacity is stretched during peak hours, which makes it more expensive to make and send electricity. On the other hand, during off-peak hours, there is too much generating capacity, so suppliers lower prices to encourage people to use it. But this is a clear chance to lower the business electricity rates.

The Financial Reasons to Use Energy Off-Peak

Changing to a time-of-use tariff and using less energy during peak times can have a big effect on your finances. There can be a big difference between business electricity rates during peak and off-peak hours. In some cases, electricity used during off-peak hours can be 50% or more cheaper than electricity used during peak hours.

Think about a factory that uses big machines. The energy cost will be highest if these machines run for eight hours a day during peak times. The company could cut the cost of the same amount of energy in half, though, if it could move its production runs to off-peak hours at night.

Practical Strategies for Off-Peak Optimisation

It's one thing to know the benefits; it's another to put a plan into action. To get the most out of off-peak energy, many UK businesses need to change how they work, invest in new technology, and change their culture. Here are some things you can do.

1. Audit Your Energy Consumption

You can't control what you don't measure. The first thing you need to do is figure out when your business uses the most energy. If you don't already have one, ask your supplier to put in a smart meter or a meter that reads every half hour. These devices provide detailed data on your energy usage in 30-minute intervals. 

Looking at this information will show you how much you use. You can find out which processes use the most energy and when they are running. This information is the basis of your off-peak strategy, which helps you find the best times to make changes.

2. Schedule Energy-Intensive Tasks for Off-Peak Hours

Once you know what activities use a lot of energy, see if you can move them to a different time. This is one of the easiest ways to take advantage of lower electricity prices.

Manufacturing

Can production runs, especially for big batches, be planned for the night? This might mean changing the staff, like adding a night shift, but the savings on energy could easily make up for the extra costs of labour.

Data Centres

Things like backing up servers, processing large amounts of data, and updating systems don't always need to be done right away. You can set these up to only run during off-peak hours.

Agriculture

For farms that grow plants indoors, lighting and climate control systems can be set to work harder at night. You can also set up your irrigation pumps to work during off-peak times.

Hospitality

Big commercial kitchens can run high-energy appliances like dishwashers and laundry machines all night. Bakeries can plan their main baking times for the early morning hours, before the busiest times of the day.

Electric Vehicle (EV) Fleets

Charging a fleet of electric vehicles takes a lot of energy. To get the best business electricity rates, make sure all of your vehicles are plugged in and set to charge overnight.

3. Invest in Energy Storage and Smart Technology

When trying to save energy, technology can be a great help.

Battery Storage Systems

With a commercial battery system, you can get electricity from the grid during cheap off-peak hours and store it. You can then use this stored energy to run your business during peak times when electricity rates are high, which protects you from having to pay high business electricity rates. There is an initial cost, but the savings on energy can be very high, especially for businesses that use a lot of energy.

Energy Management Systems (EMS)

An EMS uses smart technology to make your energy use more efficient and automatic. These systems can turn on or off equipment automatically based on a schedule that works with your off-peak tariff. They can also control the heating, ventilation, and air conditioning (HVAC) systems to use less expensive energy to heat or cool a building before business hours.

4. Embrace Energy-Efficient Equipment

Upgrading to energy-efficient equipment doesn't exactly fit the definition of an off-peak strategy, but it does lower your overall consumption, which makes any tariff savings even bigger. Older machines, lights, and HVAC systems can use a lot of energy.

When you need to buy new equipment, look for modern, energy-efficient options. Changing to LED lights, for instance, can cut energy costs related to lighting by as much as 80%. Newer motors and machines often have variable speed drives, which use a lot less power than older models that only have one speed. The total effect of these upgrades will lower your energy baseline, which will make your savings during off-peak hours even bigger.

5. Engage Your Team

The people who carry out an energy-saving plan are the only ones who can make it work. Getting your employees on board is very important. Teach them about the company's energy goals and how what they do helps reach those goals.

Make it easy for people to follow rules, like turning off lights and equipment when they're not in use. Choose energy champions from each department to spread the word about best practices and find more ways to save money. Creating a culture that cares about energy means that everyone is responsible for being efficient, not just the people at the top.

Is an Off-Peak Strategy Right for Your Business?

Not every business can use a time-of-use tariff. It might be hard for a regular 9-to-5 office with little flexibility to move a lot of its energy use. In these situations, a competitive fixed-rate tariff might still be the best deal.

But for a lot of businesses in the UK, like those in manufacturing, logistics, agriculture, hospitality, and technology, the potential is huge. You should think about an off-peak strategy if your business has any of the following:

• You operate equipment with high energy consumption.

• You have processes that can be run flexibly, outside of standard 9-to-5 hours.

• You run 24/7 operations or have night shifts.

• You manage a fleet of electric vehicles.

• You are planning to invest in new, automated machinery.

The most important thing is to do a full cost-benefit analysis. Talk to an energy broker or your supplier to see how different tariffs compare and how much you could save based on how much energy you use. You can turn a necessary cost into a competitive edge by being proactive and strategic about when and how you use electricity.

Final Words

UK businesses can save money, work more efficiently, and have a smaller carbon footprint by using off-peak energy strategies. You can save a lot of money that will directly affect your bottom line by learning about your energy use habits and using time-of-use tariffs. You can make the most of changing business electricity rates by changing your operations, buying smart technology, or just getting your team more aware of the situation. Don't wait for prices to go up; start looking into your options today and make your energy plan a source of ongoing value.