Fulfilment centre energy suppliers, tariffs and costs

Fulfilment centres are essential components of the logistics and supply chain sectors, hosting a wide range of activities from storage to packing and dispatching goods. Given the scale and nature of operations, energy consumption is a significant factor for these businesses. Efficient energy management can lead to improved cost management and reduced environmental impact. With the demand for e-commerce growing, fulfilment centres face increasing pressure to optimise their energy use. Understanding the specific energy needs and exploring tailored energy solutions can help fulfilment centres remain competitive while supporting sustainability goals.

How much does energy cost for a fulfilment centre?

There is no published price list for fulfilment centres. What a fulfilment centre pays depends on how much it uses in a year, when it agreed its contract and for how long, wholesale prices at that time, the standing charge, meter type, payment method and credit history. The most recent government figures, for the second quarter of 2026 (April to June, provisional), put the average price paid by UK non-domestic customers at 24.51p per kWh for electricity and 5.28p per kWh for gas, including the Climate Change Levy and standing charges and excluding VAT. A year earlier the averages were 24.03p and 5.31p. Smaller users typically pay more per unit: businesses using under 20,000 kWh of electricity a year averaged 38.36p per kWh, and those using under 278,000 kWh of gas averaged 9.31p per kWh.

Source: Department for Energy Security and Net Zero, Prices of fuels purchased by non-domestic consumers in the UK (Quarterly Energy Prices tables 3.4.1 and 3.4.2), published 29 September 2026. Q2 2026 figures are provisional; next update 17 December 2026. Prices are fully delivered averages including the Climate Change Levy and all other elements except VAT, so standing charges are already spread across the units. Averages across every UK business in a band, not quotes, and not comparable with a supplier’s unit rate.

Working out a monthly figure for your business

Take the annual kWh from your latest bill or annual statement, find the band above and multiply for a rough benchmark. A site using 15,000 kWh of electricity a year sits in the very small band: 15,000 × 38.36p is about £5,750 a year, or roughly £480 a month before VAT. A site using 60,000 kWh of gas a year: 60,000 × 9.31p is about £5,590 a year, or roughly £465 a month. The bands are statistical groupings used by the government, not supplier price breaks, so treat them as a guide to what similar-sized sites paid rather than a price you will be offered. To judge an actual quote, compare its total annual cost (unit rate × your annual kWh, plus the daily standing charge × 365) with what you pay now.

VAT and the Climate Change Levy on business energy

The prices above exclude VAT. Business energy normally carries VAT at 20% plus the Climate Change Levy (CCL). HMRC applies the 5% reduced rate, with no CCL, in three cases. First, low usage: supplies averaging no more than 33 kWh of electricity a day (1,000 kWh a month) or 145 kWh of gas a day (4,397 kWh a month) are treated as domestic use whoever the customer is. Second, fuel and power for domestic use, which HMRC defines to include homes providing care for the elderly or disabled, children’s homes, hospices and school or university residential accommodation. Third, a charity’s non-business activities. From 1 October 2026 to 31 March 2027, electricity that qualifies for the reduced rate is charged at 0% VAT instead of 5% in England, Scotland and Wales; qualifying gas stays at 5%, qualifying electricity in Northern Ireland stays at 5%, and electricity returns to 5% from 1 April 2027. HMRC has not changed which supplies qualify or the certificate process; the same rules decide whether a supply gets 0% or 20%. Where a site is mixed, 60% or more qualifying use means the whole supply gets the reduced rate; below that the supply is split between the two rates, and the customer gives the supplier a certificate declaring the qualifying percentage. Source: HMRC VAT Notice 701/19 (sections 2.8, 3.2 to 3.5, 4.2 and 5.2, updated 5 February 2025), gov.uk VAT rates and HMRC Revenue and Customs Brief 10 (2026).

Do Ofgem’s microbusiness protections apply to fulfilment centres?

Ofgem treats a business as a microbusiness if it has fewer than 10 employees (or their full-time equivalent) and an annual turnover or balance sheet total of no more than £2 million, or if it uses no more than 100,000 kWh of electricity or 293,000 kWh of gas a year. A business can be a microbusiness for one fuel and not the other. Independent fulfilment centres that meet either test are covered by Ofgem’s microbusiness rules, which give extra protections around contract terms and renewals (Ofgem: get energy for your business).

Do business energy rates vary by region?

Yes. Part of every unit rate covers the cost of the local electricity distribution network, and Great Britain has 14 licensed distribution areas each with its own charges, so identical contracts are priced differently in, for example, the north of Scotland and London. DESNZ does not publish non-domestic prices by region, so regional figures quoted elsewhere are supplier or broker estimates rather than official statistics.

Which energy supplier is best for fulfilment centres?

There is no single answer. Suppliers price business contracts individually rather than publishing standard tariffs for fulfilment centres, so the cheapest supplier for one business is often not the cheapest for the next: each prices on the consumption, meter type, contract length and credit profile in front of it. Compare the total annual cost of like-for-like contract lengths rather than the headline unit rate, and check the standing charge and what happens when the contract ends before signing.

How fulfilment centres use energy

Fulfilment centres typically operate on a 24/7 basis, handling high volumes of goods, which necessitates continuous energy consumption for lighting, heating, cooling, and running machinery. The energy usage patterns in these facilities are driven by the need to maintain optimal conditions for stored goods and ensure efficient operations. Lighting systems, conveyor belts, automated sorting systems, and climate control are some of the major energy-consuming components. As technology advances, many centres are increasingly investing in energy-efficient systems and processes to help reduce their overall consumption.

What affects energy bills for fulfilment centres

Several factors influence the energy costs of fulfilment centres:

• Operational hours: Longer hours of operation typically result in higher usage.
• Equipment efficiency: Older or poorly maintained equipment may consume more energy.
• Building size: Larger facilities generally require more energy for lighting and climate control.
• Peak demand charges: Energy costs can rise significantly during peak usage times.
• Energy tariffs: The choice between fixed or variable tariffs can impact overall costs.

How to compare tariffs

When comparing energy tariffs for your fulfilment centre, consider the following checklist:

• Assess current energy usage patterns and identify peak consumption periods.
• Determine the specific needs for electricity versus gas.
• Evaluate the benefits of fixed versus variable tariffs.
• Consider the potential for renewable energy sources or green tariffs.
• Factor in any potential changes in your operational scale or hours.
• Ensure that the tariff offers flexibility for future growth or adjustments in energy needs.

Gas or electricity: what matters most

In fulfilment centres, electricity is often more critical than gas, primarily due to the reliance on electrical machinery, lighting, and climate control systems. While some centres may use gas for heating, especially in larger facilities, the primary focus tends to be on optimising electrical consumption. It's important to assess the specific needs of your facility to determine the best energy mix and consider efficiency upgrades where possible.

How switching works

The process of switching energy suppliers for a fulfilment centre can be straightforward:

1. Review your current energy usage and contract terms.
2. Research and compare energy suppliers and tariffs that fit your needs.
3. Contact potential suppliers to discuss customised tariff options.
4. Select a new supplier and agree on a contract.
5. Coordinate with your current and new suppliers to manage the switch.
6. Monitor the transition to ensure a smooth changeover with no disruption to your energy supply.

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