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Business gas prices per kWh
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Average business gas rates by business size
The table below shows the average business gas rates per kWh paid by companies with one-year fixed gas contracts. The data shows average rates in 2025, and compares them to prices from the previous three years.
| Size | Annual Consumption kWh | 2022 average rates p/kWh | 2023 average rates p/kWh | 2024 average rates p/kWh | 2025 average rates p/kWh |
|---|---|---|---|---|---|
| Small | 10,000 - 50,000 | 16.31 | 8.91 | 6.42 | 6.39 |
| Medium | 50,000 - 100,000 | 15.87 | 8.51 | 5.92 | 5.89 |
| Large | 100,000 + | 15.62 | 8.36 | 5.72 | 5.69 |
Source info: Our average business gas price data has been compiled using:
- Wholesale gas rates on the National Grid published by the ICE exchange.
- Average non-commodity rates offered in the commercial gas market.
Current business gas prices December 2025
Wholesale gas prices have declined by over 30% since the start of 2025, creating an opportunity for businesses to secure lower rates.
To reflect the fall in wholesale gas prices, suppliers are now offering cheaper fixed-rate gas tariffs.
Start your business gas comparison to find out how much your business can save.
Below, you’ll find the latest average one-year fixed gas rates for December 2025.
| Size | Annual Consumption kWh | 1 Year fixed gas rate p/kWh |
|---|---|---|
| Small | 10,000 to 50,000 | 5.7 |
| Medium | 50,000 to 100,000 | 5.2 |
| Large | 100,000 + | 5.0 |
The chart below shows how fixed business gas prices have changed over the past 18 months.
Sources: Our current business gas prices data has been compiled using:
- Wholesale gas rates on the National Grid published by the ICE exchange.
- Three-month rolling average non-commodity rates offered in the commercial gas market.
Are business gas prices coming down?
Business gas prices have fallen over the last six months, driven by global economic fears surrounding US trade tariffs and a warmer-than-average start to spring, which has reduced demand and bolstered gas storage levels in the UK.
Currently, one-year fixed contract rates for small, medium, and large businesses average around 6p per kWh.
What affects business gas prices?
Several factors influence the cost of business gas, often causing fluctuations from month to month or year to year. Understanding these can help you make better decisions when arranging your gas tariffs.
Wholesale price of gas
Business gas suppliers purchase natural gas from producers and European and LNG importers. The most important determinant of gas quotes is the prices that suppliers can secure when purchasing gas to supply your business.
Length of contract
Business gas quotes are typically fixed for between one and three years. Suppliers usually offer a discount for longer contracts to reward loyalty; however, this also depends on the market’s expectations of future gas prices.
Your gas network
Regional gas distribution networks and independent gas transporters charge distribution fees that vary based on the location of your commercial property.
Market competition
Gas suppliers incorporate a profit margin into their business gas quotes. When a supplier is seeking to grow their business, they may offer more competitive quotes at a lower profit margin to attract new customers.
Green gas supplies
Some business gas suppliers offer green commitments, such as sourcing a percentage of your gas from biogas or purchasing green gas certificates. Green commitments typically raise the price of business gas quotes.
Gas connection
The capacity of your business gas connection, recorded within your MPRN, determines the fixed charges for maintaining the connection to the local gas grid.
Global gas supply and demand
Supply shortages, increased global demand, or geopolitical events can impact the cost of gas. The UK relies on imported gas through the Langeled pipeline, making it vulnerable to these global market changes.
Seasonal demand
Business gas prices often rise during colder months as demand increases for heating. Conversely, prices may fall during warmer months when demand is lower.
Types of business gas tariffs
Choosing the right business gas tariff depends on whether your business values price cost certainty, flexibility, or lower emissions. Most suppliers offer three main tariff types: fixed, variable, and green.
Fixed-rate tariffs
A fixed-rate business gas tariff locks in your unit price for the full contract term, typically one to three years. It provides predictable bills and shields your business from market price spikes, making it ideal if you prioritise cost stability and accurate budgeting.
Variable-rate tariffs
Variable tariffs track movements in the wholesale gas market. When prices fall, you can benefit from cheaper rates, but when the market rises, your costs increase. This option suits businesses that are comfortable with some risk in exchange for potential savings.
Green gas tariffs
Green gas tariffs supply energy sourced from renewable biogas or offset traditional gas through carbon credits. These contracts help businesses lower their carbon footprint and align with wider green business energy goals.
How to get the best business gas rates
Securing the best commercial gas rates doesn’t have to be complicated. Here are three effective strategies to maximise your savings:
Fix your rates
Lock in fixed prices when market conditions are favourable to avoid future price increases.
Combine services
Bundle your gas and electricity with one supplier to simplify your energy costs.
Longer contracts
Save more by selecting a longer-term contract tailored to your business needs.
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Business gas prices explained
Finding the right business gas supplier and tariff is key to controlling one of your biggest costs: heating your premises.
Unlike domestic energy rates, business gas prices aren’t protected by a price cap, so if you’re paying out-of-contract rates, you might be spending thousands more than you need to.
Below, we explain what’s included in business gas rates in Britain and the factors that influence them.
How much does business gas cost per kWh?
The cost of 1 kWh of business gas depends on several factors, including your supplier, location, tariff type, and the current state of the wholesale gas market. Over the past year, business gas prices have typically ranged from 6p to 8p per kWh, reflecting a much stabler market compared with previous years.
For tailored rates that match your business’s needs, use our business energy comparison service to request bespoke quotes today.
What’s included in business gas rates?
Business gas rates are the charges companies pay to use natural gas from the gas mains network.
These rates are outlined in your gas tariff and used to calculate your monthly business gas bill.
Here’s a summary of the different types of business gas rates:
- Unit Price: A charge for each unit (kWh) of gas consumed, measured automatically by a smart meter or manual gas meter readings. Unit rates can be fixed or variable.
- Business Gas Standing Charges: A fixed daily cost, calculated in pence per day, covers the maintenance of your connection to the local gas distribution network.
- Climate Change Levy (CCL): A government tax encouraging efficient gas usage, charged at 0.775 pence per kWh. Learn more in our guide to CCL for businesses.
- Value-Added Tax (VAT): Business gas rates are subject to VAT under UK law. Microbusiness energy customers pay 5% VAT, while all other businesses pay the standard rate of 20%. Learn more in our VAT on business energy bills guide.
Other business gas costs to consider
While your gas tariff will detail the main charges, such as the unit price, standing charges, the Climate Change Levy, and VAT, there are additional costs you should be aware of when reviewing your overall gas costs.
For example, you might encounter one-off connection or installation fees if you’re setting up a new gas supply. Some contracts include meter operator fees for installing or maintaining your gas meter, especially if it’s an older advanced business gas meter.
You may also face administrative or service fees for account management and charges for early contract termination or changes to your agreement. In variable tariffs, look out for market adjustment fees that reflect fluctuations in wholesale costs or regulatory changes.
Awareness of these extra costs can help you compare offers more accurately and choose the best deal for your business.
What is a good business gas rate?
A good business gas rate aligns with current market conditions and offers competitive pricing compared to other suppliers. It takes into account:
- The state of the wholesale gas market: Prices fluctuate based on supply and demand dynamics.
- Geopolitical influences: Events like the Ukrainian conflict can significantly impact prices.
- Contract terms: Customers can be rewarded with lower rates for agreeing to longer tariffs.
In Britain, there are over 30 business gas suppliers competing to offer the best prices. At Business Energy Deals, we specialise in connecting small businesses with the best business gas rates.
How to calculate business gas prices per kWh
Although business gas rates are billed per kWh, what really matters to your business is the total amount you’ll pay each month. You can estimate this easily using three figures from your latest bill.
Step 1. Gather your key figures
You’ll need:
- Your unit rate (pence per kWh)
- Your standing charge (pence per day)
- Your monthly gas usage (kWh)
Step 2. Calculate your total monthly cost
Multiply your usage by the unit rate to find your total energy cost, then add the standing charge for the number of days in the month.
Total monthly cost = (unit rate × kWh used) + (standing charge × days in month)
Example calculation
A small business using 2,000 kWh of gas in a 30-day month with a 7.2p unit rate and a 35p daily standing charge would pay:
- Energy consumption cost = 2,000 × £0.072 = £144.00
- Standing charge = 30 × £0.35 = £10.50
- Total monthly gas cost = £154.50 (excluding VAT and CCL)