But according to industry experts, around 80 per cent of businesses will be able to recoup the extra outlay by either switching energy retailers, negotiating a better deal with their current provider or changing their energy consumption. And, believe it or not, this may actually include increasing their energy use to alter the way the company is classified.

To understand which way suits best, you need to know what category of customer you are.

The electricity market for businesses falls into two broad categories, SMEs and “Commercial” operations. The difference is nothing to do with the size of the company, and everything to do with energy consumption.

Any business using less than 160,000 kilowatt hours per year (equating to an annual bill of roughly $20,000-$25,000) is classified as a Small or Medium-sized enterprise (SME), and anybody using over that amount is classed as a “commercial” customer. The difference is more than just semantics: because of the large amount of power they consume, commercial customers often pay around half the electricity rates charges to SMEs.

Unfortunately, Ben Freund of Goswitch.com.au, the energy comparison website, says that most businesses are unaware of this threshold, so many companies that consume above the annual 160,000 kilowatt hours-per-year threshold are still paying SME rates, which means they might be paying almost double the amount they should be.

Similarly, there will be many firms that are using just under the threshold, but who could save money by increasing their energy consumption to benefit from “commercial” arrangements.

“There needs to be a business case for increasing your energy use” said Freund. “Deliberately leaving your lights on 24hrs a day is unlikely to push you over the threshold. But we find many companies have been putting off investing in an energy intensive piece of equipment - say, an industrial refrigerator or factory machine - because they are afraid of the increase in energy costs. But they don’t realise that by increasing their power usage they will more than make up for it by qualifying for a much cheaper energy deal.”

Ironically, under these arrangements, there is not much incentive for commercial users to reduce their energy consumption – certainly not to below the threshold.

Also, be warned: power retailers often have a default rate, which is very expensive and which you may already be paying unless you have requested otherwise. The retailer will only switch you on to their best tariff if you ask. So remember, the onus is on you to be proactive.

Quiz your retailer about your usage and whether there is a more cost-effective deal that will suit your consumption.

HOW TO SAVE

1.Look at your meter or call your energy retailer to establish your annual usage. The retailer will typically look at your consumption over the previous one or two years before deciding what category to place you in.

2.As a rule of thumb, if you look at your meter and see you are using more than 14,000kw hours a month, but paying more than 10 or 11 cents per KW hr (including GST), that is an indication you are overpaying.

3.If you are an SME for energy consumption purposes, compare off-the-shelf tariffs from different retailers. Either call several firms, bill in hand, to get quotes, or use a price comparison service such as Goswitch.com.au

4.If you are a commercial consumer (using more than 160,000 kilowatt hours a year), either call different retailers to negotiate the best deal, or call goswitch.com.au for help in identifying the best providers. Goswitch.com.au has a dedicated business line to help companies save money. It is contactable on 1300 107074.

All of the above advice applies in NSW, Victoria, ACT and Queensland. In the other states, there is a monopoly in power retailing, switching retailers is not an option. However, the same threshold of 160,000kw hours consumption a year still applies.