Securing of purchasing business energy is a crucial part of running a company in the Netherlands. Whether you are a startup of an established business, finding the right energy deal an save you a significant amount of money. In this article we will cover what to consider when signing a business energy contract, how to purchase energy smartly and how to choose the best energy supplier for your company.
What is business energy?
Business energy refers to electricity and gas supplied specifically for commercial use. This includes sole proprietorships and large corporations with multiple locations. The difference between business and residential energy mainly lies in consumption, contract terms and rates.
The benefits of business energy:
- Options for green or sustainable energy
- Tailored solutions
- Fixed and variable contract options
- Volume discount
- Clear invoicing for accounting
When to sign a business energy contract?
You will need a business energy contract as soon as you begin using a property for commercial purposes. If you’ve bought or leased a new business premises it is your responsibility to choose an energy supplier and sign a contract. If you don’t do this in time you may end up with a more expensive emergency supplier or pay standard rates that are higher than the market price.
Arrange your business energy at least two weeks before you take possession of the property to avoid unnecessary costs of disconnection.
Business energy procurement: what to consider
Purchasing business energy involves more than just signing a contract. For companies with higher energy consumption it is worth taking a strategic approach. This applies to industries such as hospitality, manufacturing or retail. Key factors when purchasing business energy:
Consumption and connection: analyze your annual energy usage and determine your connection type ( small vs large business connection). This will partly determine which suppliers and contract types are available to you.
Contract type: fixed contracts, certainly over energy prices for a set period most likely 1, 2 or 3 years. Variable contracts, rates change usually twice a year- useful if market prices are falling. And last dynamic contracts, rates fluctuate with the energy exchange. Ideal for businesses that can adjust usage based on peak/off-peak times.
Sustainability: more and more businesses are opting for green energy. This helps to meet sustainability goals and build a positive brand image. Make sure the green energy is truly sustainable, for example with a guarantee of origin (GoO).
Price and terms: don’t just compare the raw energy rates also consider grid management fees, delivery charges, early termination penalties and notice periods.
Comparing business energy suppliers
The Dutch market features many business energy providers. Major players include Vattenvall, Essent, Eneco but also specialized providers like Greenchoice. Here is an list with al the business energy suppliers.
You can use a business energy comparison tool to quickly and easily find the best deal. Keep an eye on: total annual cost including taxed and fixed charges, customer service and reviews and contract flexibility. If you need help feel free to contact us.
For larger volumes or multiple locations consider using an energy consultant or procurement collective. They can negotiate better rates and contract terms on your behalf.
Tax benefits for business energy users
In the Netherlands several tax schemes are available to businesses using or investing in energy solutions, such as:
Energy investment allowance (EIA): if you invest in energy saving technologies of renewable energy you can deduct up to 45,5% of the investment costs from your taxable income.
Small-scale investment deduction (KIA): applies to smaller investments like solar panels.
MIA and Vamil schemes: for environmentally friendly investments with tax advantages.
These schemes make it more attractive to invest in solar power, heat pumps or energy-efficient equipment.
Business energy and solar panels
An increasing number of businesses are choosing to generate their own energy. Installing solar panels on your commercial property can reduce your energy costs and lower your carbon footprint.
Advantages:
- Reduced energy bills
- Feed-in compensation for surplus power
- Enhanced sustainability image
- Tax incentives through EIA, KIA or Mia
If you need energy back in to the grid, separate network fees and compensation rates apply. Also be aware of potential grid congestion in your region.
Renewing or cancelling a business energy contract
Do you already have a supplier and your contract is about to expire? It is wise to compare offers before renewing your energy contract. Many suppliers charge higher rates upon automatic renewal. Some tips you can take with you are note your contract’s end date, start comparing 1 to 2 months in advance, request multiple quotes and check for early termination fees.
You can usually switch suppliers without penalty once your contract ends. Do it in time to avoid unnecessary charges or contract extensions.
Trends and developments in the business energy market
The Dutch business energy market is evolving rapidly. Current trends include rising energy prices, driven by geopolitical tensions and the energy transition. Greater demand for green energy, from both regulations and consumer expectations. Digitization and smart meters, improved usage insights and energy management options. And dynamic contracts are attractive for business that can shift their energy usage.
What can Zakelijke Energietarieven do for you?
We at Zakelijke Energietarieven spare business owners of all their energy issues. We can help you with all your questions about business energy contracts. You can also contact us with questions about green energy contracts and what the possibilities are for your company. We have been helping international companies for many years.