25% Off! How high street sellers can reduce their business energy costs

The UK government might be planning to reduce business energy bills for industry, but what about your average high street retailer?

Jonathan Reynolds, UK Business Secretary, recently urged the government to expand energy discounts beyond big industries, warning that without reform, “energy costs will continue to price enterprises out of the UK.” He then highlighted the need for measures that help every high street business stay competitive.

Between digital disruption, shrinking footfall and rising rents, independent retailers are already navigating a tight margin. When volatile, expensive energy bills come into the picture, the writing’s on the wall. And it reads, “Everything Must Go.”

TL;DR: Business energy doesn’t have to shrink your margins

Energy costs are often complex and unfair. But with clear contracts, strategic switching, and smarter tools, high street retailers could knock 25 percent off their bills.

The things you get used to

Let’s start with some context.

Energy prices have been on an upward trajectory for a while.

We know this, we don’t like it, and yet… we get used to things quickly. That’s a phenomenon called “habituation”, when us resourceful, adaptable humans get so exposed to something it starts to seem normal.

In this case, the cost of energy. Nowadays, we practically expect astronomical bills each month. Our frame of reference has shifted.

But remember, before the 2021 energy crisis? Your bills were probably around 70% cheaper than they are now. In the UK, costs remain higher than in many European neighbours, averaging about a quarter more than what similar-sized businesses pay elsewhere.

Outdated infrastructure, reliance on the global price of gas and slow investment in renewables are all parts of the puzzle. Our new normal is not “just how things are”. Thing can change for the better, and they must.

Two major areas of concern are long fixed-term contracts at high rates, and hidden fees on your bill. Both of these lead directly to energy supplier CEOs buying their next Ferrari. They’re profit, at your cost.

Retailers get locked in, and end up paying the price

“It was a leap of faith,” says Ben Simons, owner of four convenience stores in Gloucestershire. Like many retailers, he signed a fixed-rate contract with a utility in late 2022, just as prices peaked, believing government support would cover the risk. But his bills jumped from 14p to 75p per kilowatt hour, three times the current market rate:

“It’s a major burden for those companies that just happened to be unfortunate enough to need to renew their contract in that peak period.”

Too often, retailers (who, frankly, cannot be expected to become energy experts overnight) end up in contracts that lock them into paying high prices.

Hidden costs, hidden fees

Energy pricing isn’t just high, it’s confusing and unclear — for everyone. Most contracts combine multiple charges, like delivery costs, network fees, and broker commissions, into a single line item that hides what businesses are really paying for.

Many small firms rely on brokers to navigate this complexity. But those brokers are largely unregulated and may earn hidden commissions that drive up costs without providing clear value.

That’s not to say “all energy brokers are bad” but to paint a picture that there are plenty of people out there who are after a commission for doing as little as possible. Some advisors will genuinely help you navigate this complex landscape and get you the best deal, but it’s hard to know who to trust.

How high street sellers can reduce their business energy costs

1. Break the bill down

Start by asking your supplier or broker for a full cost breakdown. That includes supply charges, network costs, broker commissions, and any risk premiums. If they can’t or won’t explain it clearly, that’s a red flag.

Why it matters: Without transparency, you can’t negotiate or compare effectively.

2. Read the contract twice

“Fixed” doesn’t always mean fixed. Check for clauses linked to market indices, hidden penalties, or automatic renewals. Some businesses locked in at peak rates are now stuck overpaying by 2-3x the current market rate.

Why it matters: Knowing the small print helps you avoid big mistakes.

3. Compare your costs

Benchmark your rate against local businesses. Costs vary significantly by region. Retailers in North Wales and Merseyside pay 13.6% more than those in London.

Why it matters: Knowing what others pay gives you leverage.

4. Band together

Retailers can create local buying groups or join trade collectives to pool demand and negotiate better deals. Even informal coordination can help build pricing power and get media attention.

Why it matters: Scale gets attention, and better rates.

5. Choose transparency-first platforms

Some providers, like tem, offer contracts without hidden fees or opaque pricing. You get a clear view of where your money’s going and how to optimise usage.

Why it matters: Less guesswork, more control.

Clarity creates momentum

When energy pricing becomes visible, manageable, and fair, it no longer chips away at your margin. It becomes a cost you can plan for, and potentially reduce.

At tem, we’ve built RED™ on top of our unique transaction technology, allowing us to deliver significant savings on energy bills by navigating around the wholesale energy market. That means your money goes directly into the hands of renewable generators, in the UK, not Big Energy. Customers have enjoyed average savings of 20, even 30 percent, with more predictable pricing making tem the provider of choice for customers across retail, hospitality and industry (including Silverstone!).

Energy should not be the line on your balance sheet that holds you back. It can be a source of strength. It’s power, for your business, and your growth.