What is a Micro Business?
Definition of a Microbusiness
A microbusiness is defined by its size or the amount of energy it uses.
A company qualifies as a microbusiness if it meets any of the following criteria:
- It has fewer than 10 employees (or the equivalent in full-time staff) and an annual turnover or balance sheet total of £2 million or less, OR
- It consumes no more than 100,000 kWh of electricity per year, OR
- It consumes no more than 293,000 kWh of gas per year
A business is classified as a microbusiness for both gas and electricity if it meets the required criteria for both employees and financial thresholds. However, if it doesn’t meet these criteria but stays within the specified consumption limits for gas or electricity, it is still considered a microbusiness for that specific fuel. Meeting the limits for both fuels means the business qualifies as a microbusiness for both.
Energy suppliers must take reasonable steps to determine a business’s microbusiness status. If they lack sufficient information, they may request details like employee count, annual turnover, or energy consumption. Some suppliers automatically assign microbusiness status based on usage.
Microbusinesses may also receive additional consumer protections that are not extended to larger businesses or standard SMEs.