The government unveils new “Energy Bills Discount Scheme” for businesses

The new scheme, called the Energy Bills Discount Scheme, will run from 31 March 2023 until 31 March 2024 and will provide the most energy and trade intensive business with the following support:

• These businesses will receive a discount reflecting the difference between a price threshold and the relevant wholesale price.
• The price threshold for the scheme will be £99/MWh for gas and £185/MWh for electricity.
• This discount will only apply to 70% of energy volumes and will be subject to a ‘maximum discount’ of £40.0/MWh for gas and £89.1/MWh for electricity.

The sectors that this level of support will be provided to can be found here: 230104_ETII_List_for_gov.uk.pdf (publishing.service.gov.uk), and it is promising to see that it includes all activities covered within UK Steel membership including:

• 24.10 Manufacture of basic iron and steel and of ferro-alloys
• 24.20 Manufacture of tubes, pipes, hollow profiles, and related fittings, of steel
• 24.31 Cold drawing of bars
• 24.32 Cold rolling of narrow strip
• 24.33 Cold forming or folding
• 24.34 Cold drawing of wire

All other sectors will get a much-reduced level of support along the following lines:

• From 1 April 2023 to 31 March 2024, all eligible non-domestic customers who have a contract with a licensed energy supplier will see a unit discount of up to £6.97/MWh automatically applied to their gas bill and a unit discount of up to £19.61/MWh applied to their electricity bill.
• This will be subject to a wholesale price threshold, set with reference to the support provided for domestic consumers, of £107/MWh for gas and £302/MWh for electricity. This means that businesses experiencing energy costs below this level will not receive support.
• Customers do not need to apply for their discount. As with the current scheme, suppliers will automatically apply reductions to the bills of all eligible non-domestic customers.

Read more: Energy Bill Discount Scheme