If your contract ends between April and September, you have a window to make a calm, well timed decision. Leave it late and you risk rollover or deemed rates that can punish cash flow. Move early and you can choose a tariff that fits your risk appetite and budget.
This guide breaks down fixed, variable and pass-through tariffs side by side. We cover who each option suits, the cash flow impact in today’s market, and how to avoid costly auto renewals. You will also find a simple decision tree, a practical checklist, and clear answers to the most common questions SMEs ask at renewal.
If you want independent advice with transparent fee breakdowns and zero pressure, WeSave can compare live prices across trusted suppliers and manage the entire switch end to end.
Quick definitions that actually help
- Fixed tariff: Your unit rates and standing charges are locked for the contract term, usually 12, 24 or 36 months. Network charges and government levies are typically fixed by the supplier within those rates.
- Variable tariff: Prices track supplier rates and can change during your contract. You gain flexibility to switch sooner but accept price risk.
- Pass-through tariff: The energy rate may be fixed, but non-energy elements like Distribution Use of System (DUoS), Transmission Network Use of System (TNUoS), losses, and some levies are passed through at cost. Bills move with these components.
Market context for 2026 renewals
Wholesale markets remain sensitive to gas storage levels, interconnector availability and geopolitical events. Prices have cooled from the 2022 peak, but volatility has not disappeared. For April to September start dates, suppliers often sharpen pricing to win share before winter. That can make 1 and 2 year fixes attractive for budgeting, while 3 year terms can suit larger users seeking long term certainty. As always, the right answer depends on your usage pattern, meter type and risk tolerance.
Side by side: risk, benefits and cash flow
Fixed
- Best for budgeting certainty. Unit rates and standing charges are set, so monthly costs are predictable.
- Suits micro businesses and SMEs with tight margins, charities, village halls and any operation that needs stable outgoings.
- Works well for single site NHH meters and many HH users who prefer cost stability.
- Cash flow impact: steady and forecastable. You may pay a small premium versus the very cheapest spot months, but you avoid spikes.
Variable
- Best for those who want flexibility and can tolerate swings. You can react if the market drops but you carry downside if it jumps.
- Suits businesses expecting a short lease, imminent site changes, or a potential move.
- Cash flow impact: can be lumpy. Budget contingencies help.
Pass-through
- Best for informed users with HH metering or larger portfolios who want visibility and potential savings on non-energy elements.
- Suits high consumption sites, multi site portfolios, and organisations with active energy management.
- Cash flow impact: moderate variability. If DUoS or TNUoS rises, bills increase. If you can shift load to cheaper time bands, you can reduce costs.
Contract length: 1, 2 or 3 years in 2026
- 1 year fixed: Good if you expect operational changes, a site move, or you believe prices may ease further. Lower commitment, easier to pivot next year.
- 2 year fixed: A common sweet spot. It smooths two winters and often lands competitive rates in spring and early summer.
- 3 year fixed: Consider if you are high usage, portfolio based or simply value long term certainty over chasing potential dips. This is sensible if you have board level budget targets or long leases. Only commit if rates align with your cost model and there are no restrictive clauses you cannot live with.
Who each option suits
- Low consumption and micro businesses: 1 or 2 year fixed brings clarity and avoids bill shocks.
- Standard SMEs with NHH meters: 1 or 2 year fixed typically best. A 3 year can suit stable operations with predictable usage.
- HH metered sites and larger users: A tailored pass-through or a well priced 2 to 3 year fixed. Consider time of use strategies and kVA review alongside procurement.
- Multi site portfolios: Blended approaches work. You might fix base load and use pass-through where you can shift demand. Align end dates across sites to simplify renewals.
If you want a live view of business electricity prices and how the structure changes by term, you can review current options and request bespoke business electricity quotes online. See current market snapshots and request pricing at https://www.wesave.co.uk/business-electricity-prices.
A simple decision tree you can use today
- Need firm budgets for the next 12 to 24 months, and price swings would hurt cash flow – Choose a 1 or 2 year fixed.
- You expect to relocate or change operations within a year, or you can tolerate variance – Consider a variable tariff, but set internal triggers to switch if prices rise.
- You have HH meters, active energy management and can shift load – Explore a pass-through contract or a hybrid, and tender MOP and data services at the same time.
- You want to de risk three winters and the offered rate works in your P&L – Consider a 3 year fixed after comparing terms across multiple suppliers.
How to avoid rollovers and nasty surprises
- Start six months out: diary a review at the 180 day mark.
- Gather data: latest bill or renewal letter, MPAN or MPRN, annual kWh, meter type, contract end date, and site list if multi site.
- Compare like for like: check day and night unit rates, standing charges, and any pass-through elements. Ask for a clear, line by line breakdown.
- Check small print: termination rights, auto renewal rules, green certificate backing, MOP and data charges for HH sites.
- Set an internal deadline: decide at least 30 days before end date to allow onboarding.
Ready to line up options without the heavy lifting? WeSave provides an impartial review of business energy, including business energy price comparison with transparent fee explanations at https://www.wesave.co.uk/business-energy/.
FAQs: Straight answers to common renewal questions
What tariff should I choose? Pick the tariff that matches your risk tolerance and operational plan. Most SMEs benefit from a 1 or 2 year fixed for budget certainty. HH or high usage sites might gain from pass-through if they manage load actively. Variable suits those who need flexibility and can handle movement.
Is it worth getting a fixed rate energy tariff? Yes, for many SMEs. A fixed tariff stabilises costs, simplifies budgeting and protects against winter spikes. It is especially helpful if cash flow is tight or you are risk averse.
Should I fix my business energy prices for 3 years? Only if the rate works in your forecast and you expect stable operations. Three years can protect against multi winter volatility, but it reduces flexibility if prices fall or you plan changes.
Should I lock in energy prices now? If your contract ends between April and September and a live quote meets your budget, locking in can make sense. Markets can move quickly. Compare multiple suppliers the same day, then decide.
What is a good rate for business electricity? Good is relative to your profile, meter type and term. The best way to judge is to compare live quotes across several suppliers on the same day, with a clear breakdown of unit rates and standing charges. You can compare business electricity plans and request tailored quotes at https://www.wesave.co.uk/business-electricity-prices.
Extra pointers for HH users and portfolios
If you have a Half Hourly meter, look beyond the unit rate. Review capacity (kVA), power factor, DUoS red amber green band exposure, and your MOP and data contracts. Small tweaks here can outweigh headline pence per kWh differences. For portfolios, align end dates, choose a standard billing format and consider a framework that blends fixed and pass-through depending on site profiles.
If you are weighing up procurement strategies or want support tendering HH related charges, speak to a specialist commercial energy broker. Learn how WeSave runs business energy procurement with transparent, line by line comparisons at https://www.wesave.co.uk/energy-procurement-services.
Summary and next step
In 2026, most SMEs renewing between April and September will find a 1 or 2 year fixed tariff balances cost and certainty. Variable works for flexibility, while pass-through can reward informed, higher usage customers who manage demand. Start your review six months out, compare like for like and set a firm internal decision date to avoid rollovers.
If you would like an impartial side by side comparison, WeSave will analyse your usage, compare live supplier prices and present a transparent breakdown so you can choose with confidence. Explore current business energy deals or request a free bespoke quote at https://www.wesave.co.uk/business-energy/. You can also call 01872 495 111 or email hello@wesave.co.uk for friendly, expert support.