With the energy price cap set to rise to around £3,500 this October, there is still no plan for an immediate course of action from the Government to help households prepare for a tough winter ahead.

While the discussion centers around consumer bills, businesses, especially small and medium enterprises, are being left out of the conversation.

Here’s what Connor Campbell, a business finance expert at NerdWallet said about the situation:

“While we are rightly talking about how the energy price cap will affect consumers, the cost of living crisis is also a crisis of the cost of doing business. This is especially true for smaller businesses that can’t absorb the cost of soaring energy prices and might be forced to pass them on to their customers.

While consumer households receive some amount of protection from the energy price cap, businesses don’t receive the same type of cover, which gives suppliers free reign over how much they can charge to cover their own wholesale costs.

We’ve already seen business energy prices almost double since this time last year, and, understandably, business owners are extremely worried about the future. Our own research shows that nearly nine in ten business owners consider rising energy prices as a massive challenge ahead.

While there are some steps that businesses can take to mitigate their energy costs, like shopping around for a better deal elsewhere or getting a smart meter, you can only cushion yourself for so long until you receive an unaffordable bill. Despite this, we still urge business owners to take as many steps as they can to keep those costs down.

It must also be frustrating for business owners to be told to cut prices in order to help with the cost of living crisis, while also being told by the government that they wouldn’t be given any extra support to help with their own soaring energy costs.

This is even harder for smaller businesses. Where larger firms are able to fix their prices several years ahead, SMEs usually can only see just the one year in advance. Most of them will renew their contract in the beginning of October, when prices are expected to monumentally rise for both consumers and businesses.

A lot of smaller firms are still recovering from the effects of the pandemic, and were relying on government support, most of which has been phased out early on this year. The government is now not only telling the small business community that they will be on their own from now on, but also asking to absorb energy suppliers’ wholesale costs for the sake of protecting consumer households, whom they aren’t helping either.”