In a report, which was published in June, accountants Ernst & Young warned that households will have to pay an average of £213 per year more by 2020 to raise the £100 billion needed for the UK to comply with the EU's targets. As gas and electricity prices for both domestic and business-users soar, the FPB is urging small firms to take advantage of its partnership with Utility Options to seek out the best deal.

"Electricity and gas supplies are always on tap, so most business-owners make the excuse that they are too busy to get to grips with the problem, and push the action needed to the bottom of their to-do lists," said Colin Beake, Managing Director of Utility Options. "What we want to tell them is that they can use us to find the best deal and we will do the hard work for them."

Simon Harvey, a director in the utilities team at Ernst & Young and co-author of the report, entitled ‘Costing the Earth', is concerned that a number of coinciding factors have led to significantly increased financial burdens.

"Customers face a triple whammy – rising fuel and oil prices, the costs of climate change mitigation and, on top of both, the additional investment required to become more energy efficient, for example, by insulating the home," said Mr Harvey.

"However, the average consumer does not appear to realise that this additional cost is going to hit their wallets. There seems to be a worrying degree of apathy among consumers to reduce energy consumption, despite daily headlines about rising fuel bills."

The FPB is concerned that, although businesses are, in some cases, paying double what they were in 2007 for gas and electricity, they are just as reluctant to realise that cutting energy consumption can save them money. In addition, particularly during the current credit crunch, many smaller firms simply cannot afford to invest in the energy-saving technologies that could reduce costs in the long-run.

Many businesses in the UK are in the process of negotiating new annual energy contracts. With indications that wholesale winter electricity prices have reached £90 per megawatt hour, small firms are being left with annual bills that are tens of thousands of pounds more than they were in 2007.

Recent research has found that almost one in five small firms is spending more than 10% of its annual turnover on energy costs.

A further 22% of smaller companies are forced to spend between 5% and 10% of their annual turnovers on energy costs. Utilities bills have now become the second biggest expense for companies, behind spending on staff wages and recruitment, and ahead of premises, equipment and insurance costs.

In addition to paying more for gas and electricity, the FPB's Chief Executive, Phil Orford, warned that other hidden utilities charges could be lying in wait for the owners of small businesses.

"The increasing cost of utilities is one of the biggest financial headaches faced by small firms," said Mr Orford. "This includes stealth taxes such as surface water charges. Small firms covered by Northumbria Water, Severn Trent, United Utilities and Yorkshire Water will be charged for the drained area they occupy, rather than their rateable value. This will inevitably mean higher water bills for many businesses."

For more information on how Utility Options can save businesses money, call the FPB's member helpline on 0845 130 1722 or email utilities@fpb.org.