Small businesses spend more than $60 billion a year on energy expenses. Energy expenditures are one of the top 5 expenses plaguing small businesses across America. According to the NFIB’s Energy Consumption Poll, 35% of SMBs reported that energy costs were one of their top three business expenses.

With the inherent volatility of the energy market, many business struggles to control rising energy costs, even as natural gas prices fall. While ironic, this was a direct result of the monopolies that state owned energy enterprises held over consumers for the past century.

In the past decade many states across the northeast and much of America have deregulated much of their gas and electricity markets. Unfortunately, many small businesses have remained apathetic to these changes and continue to stick with their state provided electricity supplier. Let’s explore the top 5 benefits that energy deregulation provides for small businesses and why they should make the switch.

  1. Supplier Choice

In deregulated markets, the available supply of energy suppliers opens up and individuals now have the choice to shop around and negotiate their own contracts. Businesses can choose either between variable or fixed electricity plans. Both have their benefits so it’s important to do your research.

I recommend hiring an energy consultant that will help you find the best contract for your business based on its size, location, and energy demand. With deregulation, businesses are no longer bullied by suppliers to pay an arbitrary fixed rate and have the freedom to pay what the market deems is correct.

  1. Aggregation

In many states, deregulation opened the door to energy aggregation. Essentially, many suppliers allowed businesses to pool their resources together to negotiate shared contracts that lowered costs for everyone across the board. In cities like Boston, this has been a huge success for small businesses who struggle to keep up with the costs of peak demand in the winter and summer. This also gives businesses more power over suppliers who can’t ignore or risk ignoring the demands of a large pool of customers.

  1. Better Customer Experience and Support

Fear not, in every deregulated state, switching your energy supplier will not result in a drop of coverage. One of the best benefits of competition in the energy market is that customer service becomes a major pull factor for businesses. When you’re stuck with one supplier, you can’t simply opt out of their services if they treat you poorly. I wish we could say the same about cable and internet providers.

  1. Loyalty Programs

With such stiff competition, many suppliers offer businesses and individuals discounts and loyalty rewards for their continued business. An energy consultant will spot these instantly and can even negotiate it into contracts for your business.

  1. Green Energy Plans

Finally, for businesses that are more eco-conscious, shop around for energy suppliers that take advantage of green energy policies. There are ton of alternative energy suppliers on the market to choose from and many suppliers are aware of how important green energy is to customers.  


Deregulation isn’t perfect and energy markets will always be volatile. Fortunately, businesses now have the choice to select the supplier who best meets their needs and save some money along the way.


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