Pub energy suppliers, tariffs and costs

Running a pub involves a unique set of energy considerations that differ from other types of businesses. Pubs typically operate for extended hours, often into the late evening, requiring a consistent and reliable energy supply to maintain optimal customer service. From powering kitchen equipment to ensuring effective lighting and heating, energy efficiency is crucial for both cost management and customer satisfaction. Additionally, with the growing emphasis on sustainability, many pub owners are increasingly looking at eco-friendly energy solutions to reduce their carbon footprint. Understanding the specific energy needs and options available can help pub businesses make informed decisions, ultimately improving their bottom line and environmental impact.

How much does energy cost for a pub?

There is no published price list for pubs. What a pub 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 pubs?

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 pubs 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 pubs?

There is no single answer. Suppliers price business contracts individually rather than publishing standard tariffs for pubs, 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 pubs use energy

Pubs are energy-intensive businesses with specific usage patterns that reflect their operational needs. A significant portion of energy consumption is dedicated to refrigeration, as they must keep beverages and perishable items at optimal temperatures. Additionally, kitchen equipment such as ovens, grills, and fryers require substantial energy, especially during peak dining hours. Lighting also plays a critical role, not only for ambiance but for safety and functionality. Many pubs have entertainment features like televisions or sound systems, which further contribute to energy use. Understanding these patterns can help pub owners identify areas for potential energy savings.

What affects energy bills for pubs

Several factors can influence energy bills for pubs, including:

• Opening hours: Extended operational hours increase energy consumption.
• Appliance efficiency: Older, less efficient equipment can significantly drive up costs.
• Seasonal changes: Heating in winter and cooling in summer can affect energy use.
• Energy tariffs: The type of tariff and supplier can impact overall costs.
• Building insulation: Poor insulation can lead to higher heating and cooling expenses.

How to compare tariffs

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

• Assess your current energy usage patterns and peak times.
• Check contract terms for flexibility and potential exit fees.
• Evaluate fixed vs. variable rate options based on your risk tolerance.
• Look for suppliers offering green energy options if sustainability is a priority.
• Consider suppliers with good customer service and support.

Gas or electricity: what matters most

For pubs, both gas and electricity are vital, but their importance depends on specific needs. Electricity is essential for lighting, refrigeration, and entertainment systems, while gas is commonly used for cooking and heating. Choosing between gas and electricity or finding the right balance is crucial for efficiency and cost-effectiveness. Pubs may also explore renewable options like solar panels to offset electricity costs.

How switching works

Switching energy suppliers for your pub involves several steps:

1. Review your current energy contract and note the end date.
2. Gather detailed energy usage data from recent bills.
3. Research and compare potential suppliers and tariffs.
4. Contact the chosen supplier to initiate the switch.
5. Notify your current supplier about the switch to avoid penalties.
6. Complete the switch and update any automatic payment details.

More business energy guides

Return to our business energy hub to explore guides for other industries, or go directly to our business gas or business electricity pages.

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