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What Counts as a Utility Bill and What Are Utilities?

This in-depth guide will cover everything you need to know about UK utility bills. From what a utility bill is to the different types of utilities, Business Energy Comparison is here to help.

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What Is a Utility Bill?

The simplest definition of a utility bill is a detailed invoice of what a business owes to an energy provider for its utilities. They are paid monthly to utility companies and cover the essential services needed to operate a business.

The most common utility bills are gas, electricity, and water bills but the utilities you use will depend on the type and size of business you have. For example, a large restaurant will most likely have a higher energy bill than a small shop.

Other expenses paid by businesses, such as insurance, tax, and mortgage payments are not classed as utility bills.

Utility bills are among the biggest expenses both small and large businesses face but there are ways to cut costs. They can also be used as proof of address when applying for a mortgage or opening a bank account.

The Different Types of Utility Bills

Utilities might sound self-explanatory but there is still some confusion about what does and doesn’t count as a utility bill. Put simply, all services provided by a public utility company are considered utility bills.

The types of utility bills you have will also differ from other companies and industries. For example, if you run a hotel, you will probably have a higher water bill than an independent shop. Or if you own a restaurant, your electricity bill will be higher than a cafe.

Here are some utility bill examples:


Electricity bills are the most common type of utility bill because almost every home and business uses electricity on a daily basis. They cover the total monthly electricity usage for a business.

The actual amount used is tracked using a meter that records the amount of electricity used on a rolling basis. This is then used to calculate your total usage every month before you receive a bill with the amount you have to pay.

Examples of business electricity include lighting, refrigeration, air conditioning, and heating. For certain industries, this may also include computers, machinery, and public transportation systems.


Gas bills are another common type of utility bill and most homes and businesses use gas on a daily basis. They cover the total monthly gas usage for a business.

Examples include heating, hot water, and cooking but how much you pay for business gas depends on the type and size of the business.

The biggest consumers of gas are the manufacturing and industrial industries.


Water bills are more complicated for businesses than they are for households. They cover the amount of water entering and leaving the building on a monthly basis. This is, put simply, the water used, drained, and wasted every month.

The water market works in a similar way to gas and electricity providers. Suppliers purchase wholesale services, such as water supply or removal, before offering packages to their retail customers.

Some businesses also have separate suppliers for water and sewage which means their water bill is separate from their sewage bill every month. This can be more expensive than paying it through one bill.

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Council Tax is an annual fee you pay to use a number of public services, including rubbish collection, road maintenance, and street cleaning. Although it is technically a household bill, it is not usually classed as a utility bill because it is based on the building’s worth.

Some people might qualify for a discount or exemption on their Council Tax if they meet certain requirements or live alone. Because of this, most lenders will accept a Council Tax bill as proof of address if it was issued in the last three months.

Business rates can also differ depending on the type of business.

Design Elements

Is a Phone Bill a Utility Bill?

Phone bills are typically classed as utilities as long as they are for business landlines, not mobiles. They cover the use of a landline for contacting suppliers and customers. Some suppliers combine a business’s phone bill and broadband bill into a single charge.

They are classed as utility bills because the invoices are structured like utility bills and phone lines provide a vital service to businesses in the same way energy companies do.

Is Broadband a Utility Bill?

There is still some debate over whether broadband is classed as a utility bill. More and more companies are classing it as a utility bill because it is essential to the running of their business in the same way as a phone line is.

The general consensus is that broadband is a utility bill because a phone bill is a utility bill. This is becoming increasingly true in today’s world where broadband is no longer an option but a necessity to be able to run a successful business.

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Is TV License a Utility Bill?

In the UK, a TV Licence is needed to be able to legally watch or record TV transmissions live on a TV, computer, or streaming device.

TV Licence bills or cable TV bills are only classed as utility bills if showing live TV is essential for your business. Otherwise, they will be charged as domestic bills and billed annually.

For example, if your customers rely on you for streaming live matches or your office shows the news, your TV Licence bills can be classed as utility bills.

Design Elements

What is the Cost of a Utility Bill?

UK utility bills have steadily risen in the last few years due to the increase in wholesale gas prices. This means they are constantly changing in line with market conditions.

The average bill will also differ depending on the size and type of the business, how much energy you use, and how many rooms the premises has. For example, a large hotel will have average bills that are significantly higher than that of a small cafe.

With that in mind, the average gas bill is currently between £820 to £1,458 for a small business and £1,458 to £2,239 for a medium business. Unsurprisingly, large businesses have the highest bills despite often benefitting from a lower cost per unit.

For business electricity, small businesses pay an average of between £2,367 to £3,660 while medium businesses are between £3,774 and £7,234. Again, a large business will have a higher bill.

However, energy bills are based on several different factors and can change based on external influences, including what energy supplier you use. You must always keep on top of utility prices and look for ways to save money if and when you can. An energy broker or consultant can work with you to help you find ways to cut costs.

Final Thoughts

Utility bills are among the biggest expenses for businesses but some people still don’t know what counts as a utility bill and what utilities are. With the average utility bill rising year on year, knowing what you’re paying for is more important than ever.

From shopping around for a better deal to switching to energy-efficient lighting, there are several things you can do to save money on your business utilities. This can help you lower overhead costs and focus on running your business.

With our helpful guide, you can better understand your business utility bill and know where to make positive changes.

Frequently Asked Questions

What are the most common utilities used by businesses?

The utilities used will differ depending on the type and size of the business but most businesses use electricity, gas, water, heating, sewage, and waste disposal. Electricity and water are usually a requirement to be able to run a brick-and-mortar store in any industry.

Do bank statements count as utilities?

Bank statements are not considered utilities and are simply a breakdown of your income and outgoings. They can, however, also be used as proof of address if you don’t have a utility bill at hand.

What does the average utility bill depend on?

The average utility bill for a business can fluctuate based on a number of things. This includes the market, the total energy consumption, the location, the billing period, the utility provider, and the energy efficiency of the building, just to name a few.