Small, micro and large business – what’s the difference?

In the business world, not all companies are the same. From your local corner store to global corporations, businesses come in many sizes. Because of this, at EDF we sort our business customers into 2 categories, small and large. Understanding these categories helps us better serve and support the growth of each type of business ensuring you get the help you need for your business. 

Ofgem however, has 3 categories – micro, small and large. In December 2024 this changed to make sure more businesses are getting fairer treatment, more support resolving disputes and greater transparency. This change will undoubtedly benefit businesses, one example is the Energy Ombudsman now covers small businesses with fewer than 50 employees and an annual turnover of £6.5 million – making sure more businesses get the complaint support they need.

Depending on where you look, you’ll find different categorisations for various business sizes, often contradicting each other. That’s why we’ve pulled all the information into one place for you.

What is a micro business?

The smallest of the three, a micro business, is defined by Ofgem with these parameters:

• employ fewer than 10 employees (or their full time equivalent) and has an annual turnover or balance sheet no greater than £2 million; or
• use no more than 100,000 kWh of electricity per year; or
• use no more than 293,000 kWh of gas per year.

What is a small business?

Ofgem defines Small Businesses as having:

• Fewer than 50 employees and an annual turnover of £6.5 million or a balance sheet total of £5 million; or
• An annual electricity consumption level of not more than 200,000kWh; or 
• An annual gas consumption level of not more than 500,000 kWh.

What’s a large business?

Large businesses are businesses that do not fit under either of the micro or small business definitions, this means that they can be defined as:

• 50 or more employees and an annual turnover exceeding £6.5 million or a balance sheet total exceeding £5 million; or
• An annual electricity consumption level of more than 200,000kWh; or 
• An annual gas consumption level of more than 500,000 kWh.

What we do at EDF

At EDF, we strive to provide the best service we can for our business customers. So that we can do this, we use these definitions which allows us to cater to your needs better:

• Small & Micro business: consumption is less than 100MWh for electricity and/or 300MWh for gas 
• Large business: more than 100MWh for electricity and/or 300MWh for gas

Benefits of splitting it up

By using our own definitions for each category, it allows us to better tailor the services we provide to you. For our micro and small business customers, this means we can provide:

• Our cheapest prices direct
• Dedicated small business energy specialists 
• Effortless online account management

For larger businesses this can mean dedicated account managers. And for our small business customer you’ll speak to someone in the same team when you contact us. This is just one reason EDF are rated excellent on Trustpilot. Don’t just take our word for it, see what our small business customers are saying:

• “Max was meticulous and knowledgeable, courteous, and very easy to talk too. A credit to EDF Thank you.” - EDF Small business customer

Types of energy contracts and what’s the difference:

When it comes to energy contracts, they fall under 3 categories. Residential, micro/small businesses and large businesses. Understanding the energy market and the differences between your typical household energy contracts and a business tariff can be important, especially if you are just starting your business, we have a blog on understanding the energy market for new small businesses which helps you understand the different types of energy contracts available.

Understanding the difference between fixed tariffs and variable tariffs is also important for your growth, a fixed contract keeps your prices locked in for the length of your contract, giving you peace of mind, whereas with a variable contract your prices can go up and down depending on the energy market, but you get greater flexibility to exit your contract. If you want to read more, we have a blog on choosing the right energy tariff for your small business.