Impact of Energy Costs on Small Businesses: A Comprehensive Overview

Introduction: The NFIB Small Business Energy Survey

WASHINGTON, D.C. (Feb. 18, 2026) – The National Federation of Independent Business (NFIB) has released its extensive new report titled the Small Business Energy Survey. This insightful report is based on a comprehensive nationwide survey of small business owners, capturing critical data about the types of energy they utilize and the repercussions of energy costs on their overall business operations. 

Key Insights from the Survey: Energy’s Role in Business Operations

The findings from the survey underscore the vital connection between energy usage and its costs, illustrating that small businesses are profoundly affected by the energy landscape. Owners rely on a diverse array of energy sources to keep their operations running, each of which presents its own set of challenges that can hinder business growth. This data sheds light on the complexities small business owners encounter while managing escalating costs and reliability issues, particularly regarding electricity, which has emerged as the predominant energy source for most. 

For those interested in delving deeper into this subject, the NFIB’s Small Business Energy Survey can be downloaded by clicking here. 

Expressing Concerns: Insights from NFIB Leadership

“Small businesses face significant exposure to rising energy costs, coupled with limited flexibility to implement cost-reduction strategies. Consequently, they experience direct operational and financial repercussions,” explained Holly Wade, Executive Director of NFIB’s Research Center. “As business owners strive to absorb the financial burden stemming from energy costs, their capacity to hire, retain talent, and foster organizational growth often becomes severely restricted.” 

Essential Findings from the Survey

Key Findings Include: 

• Approximately 80% of small business owners reported that fluctuations in energy costs significantly impact their business, either very or moderately. 

• Small business owners find themselves with limited effective strategies to manage rising energy costs. The most common methods for absorbing these heightened expenses include reduced profits (58%) and increased prices (52%). 

• Only 8% of small business owners reported that their energy costs have remained stable over the past three years. These fortunate few managed this through various strategies: 

• Twenty-six percent curtailed their overall energy consumption. 

• Twenty-three percent upgraded to more efficient equipment or lighting solutions. 

• A mere 8% transitioned to less expensive energy sources. 

• Thirty-eight percent indicated that stabilization of their costs occurred because the energy prices they utilized did not escalate. 

Factors Influencing Energy Use and Costs

• The most prevalent energy costs stem from heating and cooling needs, followed by expenditures related to operating equipment and processes, with vehicles ranking third. 

• All three factors emerged as the primary sources of energy costs for a notable percentage of small business owners, showcasing the diversity of operational realities they face. 

Vehicle and Transportation Cost Considerations

• Approximately two-thirds of small business owners consider energy efficiency to be at least somewhat important when selecting new vehicles. However, the adoption of electric and hybrid vehicles remains strikingly limited. 

• In addition to investing in more fuel-efficient vehicles, many owners are adjusting their business operations to mitigate fuel costs. 

• Examples of such adjustments include reducing the number of vehicles used or their frequency, altering driving routes, implementing regular vehicle maintenance, and negotiating terms with fuel suppliers.

Electricity and Grid Reliability Challenges

• Reliability of the power grid poses a significant risk for small business operations. 

• Two-thirds of small businesses reported experiencing a power outage in the past year, with equipment failure being the primary cause over weather-related incidents (55% vs. 15%; 28% were uncertain of the cause). 

• Many small business owners do not perceive local data centers as contributors to their rising electricity costs. 

• Only 5% indicated that their electricity expenses had been influenced by nearby data centers, while 42% believed their costs were unaffected by these facilities. 

• Additionally, 53% of respondents expressed uncertainty regarding this issue. 

Understanding Energy Mix and Cost Management Strategies

• A majority of small business owners indicate that they rely on several sources of energy to run their operations, each contributing to elevated operating costs. 

• If a small business utilizes a specific fuel source, it’s likely to present at least a moderate challenge for the owner in terms of cost management. 

• Electricity remains the most frequently used source, accompanying the highest percentage of users reporting costs as moderate issues. 

Recycling and Sustainability Practices Among Small Businesses

• Recycling is a prevalent practice among most small business owners, often driven by voluntary commitment rather than regulatory mandates. 

• Materials commonly recycled by small businesses include paper, cardboard, metal, and glass. 

Research Methodology Behind the Survey

This survey was conducted using a random sample of 20,000 NFIB members drawn from a membership database of approximately 300,000 small business owners. Conducted via email from November 3 to November 14, 2025, this survey yielded a total of 775 responses, providing valuable insights into the state of small business energy use across the nation. 

How AI legalese decoder Can Assist Small Businesses

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Utilizing AI legalese decoder can empower small business owners to understand better their rights and responsibilities concerning energy management, helping them to mitigate risks associated with energy costs and ultimately support their business growth objectives.