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Top 4 Energy Expenses for Small Businesses

Small business owners uniquely understand the impact energy costs have on operations and know that they must be mindful of their overall energy consumption. Controlling energy costs is an important factor in most successful small businesses, so it is pertinent to know the top expenses that impact the bottom line.

Heating and cooling

33% of small businesses report that heating and cooling make up the largest portion of their energy costs. These average costs vary because small businesses operate in all sizes of buildings. Some small commercial businesses, such as storefronts or service providers, may be housed in 1,000 square feet, while larger manufacturing facilities often exceed 15,000 square feet.

Regardless of building size, your small businesses shouldn’t invest more in heating and cooling costs than necessary. Wasting precious assets on inefficient systems or heating and cooling methods negatively affects the bottom line of your business. Consider consulting with an HVAC specialist to begin the conversation about energy efficiency. This technician can evaluate your current operation to determine if your equipment is in need of an upgrade or repairs.


Many small businesses, regardless of size, maintain commercial vehicles for business use. These fleets may be quite large depending on the type of business. For example, businesses that offer on-site services might maintain a fleet of up to ten or twelve vehicles. Nearly 38% of small businesses report that vehicle costs make up a majority of their energy expenditures.

Businesses hoping to reduce their vehicle energy costs have a variety of options to put more money in their pocket.

What changes can you make that will reduce your overall energy costs and streamline your operation? A simple way to reduce energy costs is to consolidate routes and vehicle use. Take a close look at the mileage, routes and cumulative trips your vehicles are taking, then decide where you can cut down on unnecessary costs. Another option is to invest in energy efficient vehicles when you’re in need of new vehicles or when you must upgrade current equipment. Consider vehicles with high mileage diesel engines or those that utilize alternative energy sources.


Often overlooked, lighting is a major contributor to a small business’ energy costs. Every business has an opportunity to save money on lighting costs.

65% of small business owners light their businesses with fluorescent bulbs, while 18% have transitioned exclusively to compact fluorescent bulbs. Investing in a computer controlled lighting system that adjusts based on a preset program can have a positive impact on your energy savings. Also, take inventory to determine if your business is using any outdated lighting systems and implement upgrades to these systems to more energy efficient models.


Each small business has specific pieces of equipment that are essential to doing business. Whether you are operating a hair salon or a production site you have equipment that consumes energy and affects your overall costs. 21% of small businesses report that their largest energy expenditure is operating equipment and/or processes.

You can reduce energy costs generated by your equipment by implementing some immediate changes and creating a strategic plan for future upgrades. Start by being mindful of when equipment is on and in-use. Turn electronics off when not in use and maximize the time equipment is on by condensing work into a single operating session. Going forward, plan to invest in energy efficient models when purchasing or upgrading your current equipment. Pay attention to the overall energy costs of new equipment and make wise choices that will help lower your overall expenditures.


Regardless of what your top energy expenditure is there are definite ways to save money with smart choices and wise investments. By upgrading and streamlining your systems, you’ll be able to be smarter with your energy and help cut down expenses.  Energy expenses for small businesses don’t have to be out of control.



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