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How to reduce business energy costs (without cutting corners)

U.S. small businesses spend an average of $1,500 per month (or $18,000 a year) for business energy costs like electricity and natural gas, . The good news? You could save on the cost of electricity for any business by up to 30% (or $5,400 annually) through smart energy-saving strategies, according to the .

Over time, these savings can add up to tens of thousands of dollars — freeing up budget for business investments that can help fuel your growth. Some upgrades might even help lower your costs.

And you don’t have to sacrifice comfort to make it happen. shares 14 energy-saving tips to cut your electricity costs — with ideas for every budget and timeline.

Quick wins: No-cost ways to lower your energy bill

You don’t have to spend a dime to start saving. These low-effort changes can begin reducing your business energy bills right away — and every little bit adds up.

“Getting people on board helped,” says Danilo Coviello, CEO of . “Now it’s second nature to shut off all unused equipment before the end of the day.” That slight shift reduced their electricity bill by 5% over time.

Here are a few more quick wins, recommended by the , that can immediately impact your business’s energy costs.

1. Encourage energy-saving habits to reduce business energy costs

Encourage your team to turn off lights, shut down unused equipment and put computers in sleep mode when unused. Small reminders near light switches or shared workstations can help reinforce the habit — and turn it into a routine. These small behavior shifts can reduce energy usage and lower electricity bills without new equipment.

2. Go paperless where you can

Shifting to digital systems can reduce paper, ink and electricity usage, making your business more efficient. If you’re not ready to go fully paperless, simple changes like double-sided printing or using digital forms for internal processes can still cut costs.

3. Shift energy use to off-peak hours

Many electricity providers and local utility companies offer better energy rates during off-peak times. Running high-energy equipment — like industrial printers, kitchen appliances or production machines — outside peak hours can help you save on business electricity without cutting productivity.

4. Adjust your thermostat seasonally

Adjusting settings based on the square footage of your workspace and your actual energy needs can improve efficiency. According to the DOE, turning your thermostat down by 7 to 10 degrees Fahrenheit for just eight hours a day during colder months can save you up to 10% per year on heating. Program it to ease up overnight or while your space is empty to save without feeling the chill.

5. Use natural light and window treatments

In warmer months, use blinds or curtains to block out heat from direct sunlight and reduce your need for air conditioning. In colder weather, do the opposite — open the shades during the day to let sunlight naturally warm your space.

Smart upgrades: Low-cost fixes with a high return on investment

Implementing these upgrades takes more time and money but can deliver significant returns. A professional energy audit, for example, costs around $440, . But it can help cut your small business’s energy costs by up to , says the DOE.

That kind of upfront investment can lead to long-term savings that benefit your bottom line.

6. Bring in a professional energy auditor to reduce energy costs

A certified energy auditor can uncover where you’re losing efficiency, how much energy consumption each system contributes and whether you’re overpaying based on your rate plan. While you can start with a DIY energy audit, hiring a pro gives you access to specialized tools and recommendations that can uncover hidden inefficiencies.

7. Maintain and inspect equipment

When machines or systems wear down, they often use more energy — this is especially concerning if you’re on a fixed-rate electricity plan, where waste leads directly to higher costs. Scheduling regular inspections helps ensure everything is running efficiently and safely. Not sure where to start? Your equipment manual can usually guide you on recommended maintenance timelines.

8. Seal air leaks to reduce heating and cooling waste

This is one of the most cost-effective energy solutions for older buildings. Even small gaps around windows, doors or walls can force your HVAC system to work overtime. Add weatherstripping to seal drafty doors and windows and use caulk to fill cracks in walls, floors or ceilings. These simple fixes can help keep warm or cool air inside — and energy bills down.

9. Swap in smart power strips

Smart power strips help cut “phantom” energy usage — the electricity your devices still draw even when turned off. Unlike standard strips, these automatically stop power flow to idle equipment, helping you reduce waste and lower your monthly energy bills.

10. Upgrade to LED lighting to reduce commercial energy use

LEDs use up to 75% less energy and last 25 times longer than traditional incandescent bulbs, according to the . That switch offers both cost savings and measurable reductions in your business’s carbon footprint.

Danilo Coviello of Espresso Translations saw the impact firsthand: “Our electricity bill has dropped about 12% within two months. It’s the kind of immediate savings that accumulate, and the installation was prompt.”

High-impact investments: Long-term energy efficiency

Some energy-saving improvements take more time and money upfront — but they can unlock major long-term savings. With today’s changing energy market, locking in long-term energy savings through upgrades can offer more predictability and control. Many of these upgrades may also qualify for tax credits, rebates or local incentives, depending on your business location.

If you’re ready to make bigger moves, these ideas can help lower your energy bill for years to come.

11. Improve insulation to maintain indoor comfort

Poor insulation drives up energy consumption, so this step is especially important for businesses on commercial electricity rates. Good insulation keeps warm or cool air inside — so your HVAC system doesn’t have to work as hard. That means lower energy use, better temperature control and potential savings year-round.

If you’re renovating, consider upgrading insulation while replacing siding or roofing. Choosing the right type for your building and climate can make a big difference.

12. Upgrade outdated appliances and systems

Old or inefficient equipment often uses more electricity, gas or water to get the job done. Replacing equipment with Energy Star-certified models can improve energy efficiency by up to 20%, reports the DOE.

13. Explore renewable energy options like solar

If your business electricity rates are high due to usage or energy supplier pricing, solar can offer a long-term way to stabilize your costs. Many states offer tax credits or rebates to help offset the upfront investment.

Not ready for a full install? Explore green energy options through community or shared energy sources.

14. Use smart technology to automate energy savings

Smart thermostats, lighting systems and plugs can automatically adjust based on occupancy, time of day and your selected electricity plan — so you’re not wasting power when it’s not needed. Many also allow for remote control from a phone or laptop, making it easy to manage energy use even when you’re off-site.

For example, a smart thermostat can reduce heating or cooling when no one’s around, while occupancy sensors can turn lights off in empty rooms. These small upgrades take the guesswork out of saving — and help you avoid waste without lifting a finger.

How energy upgrades may help lower insurance costs

Energy-efficient upgrades don’t just reduce your utility bills — they can also help lower risk, which may influence your . By optimizing your energy supply and reducing peak demand, you’re not just saving on energy — you’re lowering business risks, too.

Many improvements that cut energy use also make your building safer, more secure or less prone to damage. For example:

• Upgraded HVAC systems are less likely to overheat or fail, reducing fire risk or breakdowns.
• Improved insulation and weatherproofing can protect against water damage, fire exposure or temperature-related issues.
• Smart technology, such as leak detectors, smoke alarms or motion-activated lighting, can help detect problems early and prevent costly incidents.

From an insurance perspective, these changes can reduce the likelihood of and operational downtime — potentially leading to better rates on .

While these upgrades don’t guarantee lower , they may help improve your overall risk profile in the eyes of insurers.

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