Skip to main content

What is a utility bill?

Within this guide, we will break down utility bill examples, the several types of utility bills and how to pay your utility bill. We will also let you know how to save money on your energy bills as energy prices continue to soar. Find out more with Business Energy Comparison.

Business Energy Comparison Background - Blue
Business owner looking at utilitybills

As a business owner, you will be faced with a variety of bills including a utility bill which can cost hundreds or even thousands of pounds a month. Utility bills are not usually a top priority for business owners, but it is important to understand the types of utility bills to help you decide your monthly outgoings.

A complete guide to utility bills

Basic utilities are required by most businesses to continue business operations. The usage of these basic utilities is completely dependent on the size of your business as well as the sector it works. For example, a school’s energy usage will be much higher than a large-scale warehouse.

One utility bill is simply a summary of the utilities used by a business or household each month. When you receive your detailed invoice, this will explain your electricity, gas and water usage for that month. It is important to remember, the higher your usage, the more you will pay a month! Business utility bills are usually considerably more than a domestic utility bills as their consumption will be a lot higher.

Your utility bill will look like a monthly statement including your usage for that month, earlier charges and any outstanding balances. This applies to your electricity, gas and water bills.

Top tip: If you need proof of current address for a passport or mortgage application, utility bills can be used for this!

Business Energy comparison

Now we have a basic understanding of what is included on a utility bill, let’s take a deeper look at the different types of utility bills and what outgoings your business should expect.

Look below at the most common utility bills:


Electricity is the most used utility within businesses and households. If you are looking to reduce your electricity consumption, you can implement energy-saving tips and techniques. These can be simple changes such as implementing LED lighting and speaking to employees about how they can save energy in the workplace.


Gas is used for heating and cooling purposes. By lowering the temperature on your thermostat by just one degree, you could save money on your business gas bill. If you are looking to reduce your carbon footprint, we can help you switch to a green energy supplier.


Every month you will be billed for the water used within your home or business. If you are looking to reduce the amount you spend on the water, make sure there are no leaks at your property and that taps are turned off fully. By making these simple changes, you should see a difference in your business water bills.

Breakdown of your average utility bill

Environmental costs

Approximately 6% of your gas bill and 11% of your electricity bill are environmental costs. These are essential parts of an average bill as this subsidises the cost of the government’s environmental initiatives.

Environmental schemes which are subsidised by your gas and electricity bill include:

  • Feed-in Tariff scheme (FIT)
  • Carbon Emissions Reduction Target (CERT)
  • Community Energy Saving Programme (CESP)
  • The Renewables Obligation (RO)
  • EU Emissions Trading Scheme (ETS)


VAT charges

VAT charges are a small part of your energy bill. You do not pay full VAT on energy bills, but you do pay 5% VAT on your bills.


Transmission charges

Transmission charges help cover the cost of delivering energy to your home or business as well as building and maintenance costs. Approximately 2% of your gas bill and 4% of your electricity bill cover transmission charges.

Business Energy Comparison Background - Blue
Utility bills on a table
Design Elements

Distribution charges

Similarly, to Transmission charges, a small percentage of your bill will cover distribution charges which cover the build and maintenance of gas pipes and electrical wires which deliver the energy. 16% of your gas bill and 16% of your electricity bill contributes to distribution charges.


Wholesale energy and supply costs

The biggest cost included on your utility bill will be for the gas and electricity you use. This comes to approximately 67% and 58% of your respective bills.

Wholesale energy and supply costs are the charges your utility provider must pay when buying the gas and electricity they are supplying.


Other costs

There are many added costs associated with your energy bill, gas storage costs and meter installations make up approximately 4% of your gas bill and 5% of your electricity bill.

What counts as a utility bill?

Now we have looked at the full breakdown of a utility bill meaning, let’s take a look at what counts as a utility bill. All the costs associated with running a business or household count as utility expenses.

Business electricity, gas, water, broadband, mobile phones, and heating are all common utilities faced by businesses and households.

Business Energy Comparison Background - Blue
Utility bills on a table

Is council tax a utility bill?

Council tax subsidises the cost of roadworks, maintenance, school fees and bin collections which households must pay annually. Although. companies do not have to pay council tax as they pay business rates instead, is council tax a utility bill?

Council tax is an unavoidable outgoing that homeowners must factor into their household bills. Because of this, council tax is not a utility bill and is simply a household bill.

If you run your business from your home, you will need to pay both council and business taxes, but you do not need to worry about business rates if:

  • Your business is run from one room within your homes such as a garage or office
  • Your business doesn’t employ any staff to work from your home
  • No renovations have taken place within your home for business purposes such as a garage conversion
  • Your business doesn’t sell services or goods to customers from your home instead you send goods by post

Is a phone bill a utility bill?

If you have a landline, this is classed as a utility bill, but mobiles are usually not. If you receive an invoice from a telecoms company, this is considered a utility bill as they are providing a service which aids with the day-to-day running of your business.

Telephone bills are usually invoiced and paid every month, but this does depend on the type of tariff you chose.

Is broadband a utility bill?


Most businesses need broadband to run as a business which makes broadband a utility bill. Business broadband includes telephones, mobiles, internet and much more which are essential to business operations.

This is another monthly cost that companies need to factor into their expenses. You will usually receive your broadband bill every month but similarly to your phone bill, this depends on the type of contract that you have selected.

Is a TV licence a utility bill?

Most businesses need broadband to run as a business which makes broadband a utility bill. Business broadband includes telephones, mobiles, internet and much more which are essential to business operations.

This is another monthly cost that companies need to factor into their expenses. You will usually receive your broadband bill every month but similarly to your phone bill, this depends on the type of contract that you have selected.

Is a bank statement a utility bill?

A bank statement is not classed as a utility bill. A bank statement is simply a breakdown of your bank account activity.

Man with design element above her head stock image

How much is the average utility bill?

Working out how much the average utility bill costs depends on many factors such as the size of your business, your local area, how much energy you use and much more.

Now we understand the complete breakdown of a utility bill and what isn’t, we can now look at how we can reduce your utility bill. Contact our energy experts to find out how much you could save on your energy bills. We can help you find the most competitive price and find a deal that suits your business. If you want to start saving on your utility bills, contact us now!

How to save money on your energy bills?

Secure the best contract for your needs

There are a variety of different energy contracts available, and it is important to choose the best deal for your business’s needs. We can help you compare a variety of deals from a vast range of suppliers to find one that suits you. If you do not secure the best prices for your business, you may end up paying more than you need to for your business energy.


Install a smart meter

Installing a smart meter is a fantastic way to precisely track your energy usage and how much it is costing your business. Smart meter readings show real-time stats to help you take control of your business’s energy consumption.


Encourage employees to be energy efficient

Provide employees with simple energy-efficient tips so everyone can get involved with becoming more energy efficient. These simple steps can reduce your carbon footprint as well as protect the planet. You can also create incentives for employees as a reward for taking part.


Introduce remote working

Introducing remote or flexible working can reduce your business energy consumption. If employees are working from home a couple of days a week this will help, make significant savings on your energy bill.

Design Elements
Design Elements

Look into renewable energy

Investing in renewable energy technologies can help save your company money over time. Renewable energy solutions such as solar panels and wind turbines can help your business benefit from a reduced carbon footprint as well as your reliance on fossil fuels.


How to change the name on the utility bill?

To change the name on your utility bills, you need to phone your utility company and simply inform them of what needs to be changed and they will manage the entire process for you.


How do I pay my utility bill?

When you set up your utility bills with your provider, your payment method will be agreed upon beforehand. Most people pay for their utilities via Direct Debit or Standing Order.


How long do to keep utility bill statements?

Utility bills are either sent by post or email. If you receive your utility bill through the post, you should keep these for your records in case you ever need to refer to them. If you receive your bills by email or access your bills online via a portal, these will be automatically stored. You don’t need to hold onto them unless you’ve been asked to, so you can keep them, or you can shred them!

We recommend you store your utility bills from the last 3 months and shred any bills older than this. It is important to add the costs of utility bills into your company budget as this is an important expense which must be paid monthly.

What to do if you’re struggling with your utility bills?

If you are struggling with your utility bill, you should call your energy provider at once. Your energy supplier may be able to help set up a new payment plan or a lower price to help you afford your energy bill. If you do not act, you risk having your energy supply cut off.

Due to the energy crisis and cost of living crisis, the government are offering a variety of schemes for businesses and households to help with energy bills such as the Winter Fuel Payment and Energy Bill Relief Scheme.

Contact us for more information

If you want to know more about your utility bills or find out how to get the best prices on your utility bills, get in touch with one of our energy experts today to compare business gas prices and start your business electricity comparison.