8 common business energy bill errors.

13 November 2026 · 6 min read

Business energy bills are long, technical and rarely checked line by line. Most errors are small on each bill, but they repeat every month, sometimes for years. These are the ones we find most often.

1. VAT at 20% when 5% should apply

Business energy is normally charged VAT at 20%. The reduced rate of 5% applies in two main cases:

Small users (de minimis): electricity use of 33 kWh a day or less (1,000 kWh a month), or gas of 145 kWh a day or less (4,397 kWh a month), averaged over the billing period.
Qualifying use: where energy is used for domestic purposes or by a charity for non-business activities. If at least 60% of the supply is for qualifying use, the whole supply can get the reduced rate; below that, it is split.

Qualifying-use relief needs a VAT declaration with your supplier. If one was never sent, or got lost when you switched supplier, you may be paying the wrong rate.

2. Climate Change Levy on supplies that should be excluded

The Climate Change Levy (CCL) is a tax on business energy. It doesn’t apply to supplies for domestic use, to charities’ non-business use, or to small supplies under 1,000 kWh a month of electricity or 4,397 kWh a month of gas. A mixed-use site where at least 60% of use qualifies can be excluded altogether. CCL charged on an excluded supply is a straightforward error.

3. Estimated reads that never get corrected

Estimated bills are meant to be trued up when a real reading comes in. When a meter isn’t read, or a smart meter stops sending data, estimates can run on for months, and they are often too high.

4. Paying for the wrong meter

Each electricity supply has a unique MPAN (and gas an MPRN). After moves, building splits or new connections, it is surprisingly common to pay for a neighbour’s meter, a supply that has been disconnected, or the same meter twice.

5. Out-of-contract or deemed rates

When a fixed contract ends without a renewal, many suppliers move you onto out-of-contract or deemed rates, which can be far higher than a negotiated price. The same happens when you move into premises and never agree a contract.

6. Capacity set wrong

Larger electricity supplies pay for an agreed capacity (in kVA). Set it too high and you pay for headroom you never use; set it too low and excess capacity charges apply whenever you go over. It is rarely reviewed after the site changes.

7. Pass-through charges added incorrectly

On some contracts, network and policy costs are passed through separately. Mistakes in those lines, such as the wrong time bands, a wrong loss factor, or charges for a period you weren’t supplied, are hard to spot without checking the detail.

8. Old bills you shouldn’t have to pay

If you are a microbusiness, Ofgem rules stop suppliers billing you for energy used more than 12 months ago where the delay was the supplier’s fault. A large catch-up bill covering several years may not all be payable.

How to check your own bills

You need 12 months of bills, your MPAN (and MPRN for gas), and your contract. Check the VAT rate and CCL against how the site is used, compare unit rates to the contract, look for runs of estimated reads, and confirm every meter on the bill is yours.

Or let us do it

Our free bill check covers all of the above. If we find an overcharge, we recover it on a no-win, no-fee basis. Then an Energy Fingerprint shows how to cut the bill itself.

Sources: HMRC: VAT fuel and power, de minimis supplies; GOV.UK: Exemptions from Climate Change Levy; Ofgem: back-billing limited to 12 months. Correct at the date shown; rules can change, so check the source or ask us before acting.