Reducing energy costs for SMEs – 5 Top Tips

reducing energy costs
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Reducing energy costs can be one of the main focuses and concerns for an SME at the best of times. It often accounts for a significant proportion of your outgoings and expenses. So it’s vital that you are clear about what you are doing in this area, in order to ensure that you get it right. But with lockdown still ongoing and the current uncertainty surrounding the COVID pandemic situation not set to come to an end any time soon, it’s more important than ever to ensure you’re maximising your savings in this key area. That’s why we’ve put together this blog post for you, so you can get some helpful tips and advice on key things to look at. Let’s get started running through the tips now…

Reduce your lighting costs

Lighting can account for up to 40% of your energy costs as an SME. This makes it a prime area that you should be focusing on when it comes to reducing your energy costs.

Be sure to make the best use of the natural light available in your workspace. This will help to reduce the need for artificial lighting. There are some key ways that you might go about doing this.

For example, you might consider moving around furniture and other key items within your commercial premises. This could enable you to make better use of natural light for your employees. Shift around large cabinets or shelving that blocks out natural light.

Reduce the need for employees to use blinds to block out natural light. This can be done be ensuring that employees are not suffering from excess screen glare, forcing them to pull down the blinds.

You could also look into certain types of blinds that use the natural light available in a more efficient way. For example, horizontal blinds tend to direct sunlight onto ceilings to avoid excess screen glare.

Be sure that all employees understand how this works so that they don’t inadvertently open windows when it’s not required.

You can also use energy efficient LED bulbs and occupancy sensors to reduce lighting costs. LED lights can use up to 90% less energy than traditional bulbs. So this could be another significant cost saver for your business.

Reduce the cost of Fridges and Freezers

Fridges and Freezes are another area where significant savings can often be made.

Improve the efficiency of them by defrosting them on a regular basis. Also be sure to relocate them if they are next to any kind of heat source.

Check that the temperature dials of these devices are set to the recommended levels. Note that every 1°C increase reduces energy use by 2%. So you can see where this could be a significant money saver.

Also avoid overfilling your fridges and freezers. This is because overfilling will mean cool air can’t circulate as well. Keeping fridges and freezers constantly overfilled can increase your running costs by as much as 10%!

As a general rule, try and ensure that fridges and freezes are never more than three-quarters full. This should ensure that they are as efficient as possible.

Also, check the door seals on these appliances to make sure they are not damaged. This can enable cool air to escape, thereby pushing up the running costs further.

Consider your air conditioning expenditure when looking at reducing energy costs

Air conditioning can double the costs of energy for a business when not used and monitored properly. This makes it another obvious place to look if you have it and you want to reduce your costs.

Ensure air conditioning is fully switched off outside of working hours. You don’t want to waste money using it to keep areas cool when no one is using them.

If you have an IT server room, this might require a different approach though. You might be required to use air conditioning to keep this room at a certain temperature as recommended by the manufacturer. So be sure to consider that when looking into this area of reducing your costs.

Also note that you should never have windows open when the air conditioning is operational. This allows the cool air to escape so you are literally just throwing money away.

Switch off all equipment when not in use

Another obvious and simple way to reduce costs is to ensure that equipment is switched off whenever it’s not in use. Have formal rules and procedures for switching off equipment at the end of each day.

This should ensure that everyone gets in the habit of ensuring that this is always implemented. It’s important that staff always turn off their PC’s and monitors when not in use. A single monitor and PC left on 24 hours a day can cost around £45 a year!

You can install things like timers or set reminders to further ensure that this gets done. These small but significant measures can all add up over time and lead to significant cost savings.

Reducing energy costs by securing a better deal

One of the best ways to lock in lower energy costs is to shop around for a better supply deal.  Check your contract end date: some suppliers roll small business onto their ‘default’ tariff, which can increase bills by up to 50%. 

Consider smarter approaches too, such as joining an existing buying group to gain buying power.  Or working with a consultant who can help you secure better energy prices, by advance buying when they are most favourable. 

The right strategy can also help you reduce some of the components of cost in the price that simply ‘shopping around’ may not touch.  Energy-Smarts can help you identify and adopt the the best approach for your business and gain favourable pricing to meet your needs.

Get some expert advice and guidance

There can be a lot more to cost savings in relation to your energy than many people think and if you would like to ask us a question about reducing your energy costs, please email us

Indeed, for many small and medium-sized organisations energy efficiency and carbon reduction is becoming more and more important. If this is coming onto your agenda, you may like to take a look here and then complete our energy efficiency awareness survey.

Also if you’d like to find out more about smart energy procurement you can register for a free account, which gets you access to a host of free information and resources that can help you in this area. 

We also have a Video Masterclass which runs you through smarter energy procurement in much greater detail. This would be a great option if you want to understand what makes up your contract prices and also learn about some more advanced strategies for dealing with them.

Finally, if you’re really serious about reducing energy costs and would like to get some more tailored advice, then you can schedule a free consultation with us with a view to engaging our full service. This is where we can talk you through your options and answer any specific questions that you have.

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