Should my business choose fixed or variable energy?
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In short: Fixed business energy locks unit rates for 1–3 years — aiding budget certainty for salons, cafes and offices with tight margins. Variable contracts track market movements — better when wholesale prices fall but exposing you to spikes without domestic cap protection.
Last reviewed:
Reviewed by Kaiser Khan
Fixed deals suit businesses that cannot pass energy costs instantly to customers — bakeries, laundrettes and cold storage with high gas use.
Variable may suit low-consumption offices willing to switch frequently when markets dip — monitor broker alerts monthly.
Pass-through elements — distribution charges, policy levies — may vary even on 'fixed' business contracts unless fully fixed products are specified.
Hedging with solar, battery storage or power purchase agreements complements tariff choice for larger sites. See business energy explained for fixed-term negotiation tips.
Primary source: ofgem.gov.uk/information-consumers/energy-advice-businesses
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