Energy costs are climbing fast, and for businesses, that means higher expenses and tighter margins. Whether you run a manufacturing plant, a commercial facility, or an office building, rising utility rates impact your bottom line—and ignoring them isn’t an option.
Some companies feel like they’re at the mercy of their utility provider, forced to absorb cost increases without any real control. But that’s not the case. There are practical steps businesses can take to reduce their energy expenses, increase efficiency, and gain long-term cost stability.
This article will break down why energy costs are rising, what that means for your business, and—most importantly—what you can do about it.
Why Are Energy Costs Rising?
Energy prices aren’t going up for just one reason—it’s a mix of supply issues, utility rate adjustments, and shifting regulations.
More Demand, Less Supply
Demand for electricity has never been higher, but supply chains are struggling. Fuel shortages and distribution delays have made it more expensive for power plants to generate electricity. When suppliers pay more for fuel, they pass those costs on to businesses like yours.
Utility Rate Hikes
Utilities regularly raise rates to cover infrastructure upgrades, repairs, and operational costs. And unlike residential customers who sometimes get rate protections, commercial energy users are the first to feel the impact of price hikes. In 2023, the average commercial electricity rate in the U.S. was 13.18 cents per kilowatt-hour (kWh), while residential rates were 16.79 cents per kWh (Shrink That Footprint). It may seem like businesses pay less per kWh, but because they use significantly more energy, even small rate increases add up fast.
Real-World Example: An Illinois Manufacturer’s Rate Hike
A manufacturer in Illinois that we first consulted in June 2023 and revisited in January 2025 saw firsthand how utility companies raise rates—even when energy use is flat or declining.
- Plant 1: Their rate increased 18.52% to $0.0821 per kWh, while their total spend jumped 13.29%, despite virtually no change in usage.
- Plant 2: Even though they used 15.33% less energy, their rate spiked 21.24%—proving that cutting usage alone doesn’t protect businesses from rising costs.
This is the reality businesses are facing: utility companies can raise prices at any time, and there’s nothing you can do about it—except generate your own power.
How Rising Energy Costs Impact Your Business
Higher utility bills cut directly into profits, especially for energy-intensive operations like Higher utility bills cut directly into profits, especially for energy-intensive operations like manufacturing, warehousing, and retail. When energy costs aren’t predictable, it’s impossible to set accurate budgets—businesses are left reallocating funds that could have gone toward hiring, expansion, or equipment upgrades.
Companies that ignore rising energy costs also risk losing their competitive edge. Those who invest in cost-saving energy solutions can keep prices stable and reinvest savings into growth. Businesses that don’t? They’ll be forced to either absorb the costs or pass them on to customers.
The longer a business waits to address its energy strategy, the more vulnerable it becomes to future price hikes. Energy rates aren’t going down anytime soon. The question isn’t whether businesses should act—it’s what they should be doing right now.
What Can Your Business Do About Rising Energy Costs?
There’s no single fix, but businesses that take a proactive approach can significantly reduce energy waste, control costs, and secure long-term savings.
Reduce Energy Waste
Energy efficiency upgrades are the easiest way to lower costs without making major investments. The first step is an energy audit to pinpoint waste. Many businesses don’t realize how much power they’re losing to inefficient equipment, outdated lighting, or poor energy management.
Simple upgrades make a big difference:
- Switching to LED lighting can cut energy use by up to 75%.
- Upgrading to high-efficiency HVAC systems reduces power consumption.
- Installing smart thermostats and automated controls ensures energy isn’t wasted when facilities aren’t in use.
Small improvements add up to major savings over time.
Take Advantage of Incentives & Tax Credits
Federal and state programs are available to help businesses offset the cost of energy upgrades. These incentives lower the upfront cost of projects and speed up ROI.
The Investment Tax Credit (ITC) is one of the best incentives, allowing businesses to deduct 30% of solar installation costs (Energy.gov). Many utilities also offer rebates for energy efficiency projects, which can further reduce costs.
Failing to take advantage of available programs means leaving money on the table.
Invest in Solar for Long-Term Cost Stability
One of the best ways to take control of energy costs is to stop relying on the utility company altogether. A commercial solar system allows businesses to lock in predictable energy pricing for decades, shielding them from future rate hikes.
Many businesses that install solar reduce their energy expenses by 50-80% in as little as 2-7 years. With federal tax credits, depreciation benefits, and financing options, the return on investment has never been stronger. And for businesses that don’t want to purchase a system outright, Power Purchase Agreements (PPAs) provide a way to go solar with zero upfront cost while still benefiting from lower electricity rates.
Negotiate Better Energy Contracts
For businesses that aren’t ready for solar, shopping for a better energy contract can still make a big difference. In deregulated energy markets, companies can choose their electricity provider, which allows them to lock in lower rates.
Options include:
- Negotiating long-term energy contracts to secure fixed pricing.
- Exploring wholesale energy purchasing or demand-response programs.
- Working with an energy consultant to find cost-effective supply options.
A smarter contract won’t eliminate energy costs, but it can help businesses avoid unpredictable rate spikes.
Why Businesses Are Turning to Solar as a Solution
Companies that are serious about controlling energy costs are investing in solar because it offers stability and predictability that traditional energy sources can’t match.
Instead of waiting for the next utility rate increase, businesses that install solar lock in fixed electricity rates for 25+ years. Instead of absorbing higher operating costs, they redirect savings into other areas of the business.
And it’s not just about cost savings. Solar incentives, tax credits, and accelerated depreciation make the financial case even stronger. Properties with solar increase in value, making it a smart investment for commercial building owners.
The sooner a business switches to solar, the more it saves in the long run. Those who wait will continue to pay higher utility rates with no end in sight.
Take Control of Your Energy Future
Rising energy costs aren’t slowing down, but that doesn’t mean businesses have to sit back and absorb the expense. There are real solutions available, and companies that take action now will be in the strongest position to protect their bottom line and secure long-term financial stability.
If your business wants to:
✔ Reduce energy waste and cut operating costs
✔ Take advantage of incentives and tax credits
✔ Lock in predictable energy pricing for decades
✔ Gain energy independence with commercial solar
Then it’s time to make a plan.
At Artisun Solar, we help businesses transition to energy independence. Whether you’re considering solar, efficiency upgrades, or alternative energy contracts, our team can provide a customized strategy for cutting costs and securing your energy future.
Want to see how solar can help your business fight rising energy costs?
Request Your Free Solar Assessment Today
