The government announced the Energy Bill Discount Scheme for UK businesses, charities, and the public sector in April 2023.
The energy scheme will discount high energy costs to give businesses certainty while limiting taxpayers’ exposure to volatile energy markets.
Businesses in sectors with exceptionally high energy use and trade intensity levels will receive a higher level of support.
A new energy scheme for businesses, charities, and the public sector has been confirmed on 9th January, ahead of the current strategy ending in March. The new plan will mean all eligible UK businesses and non-domestic energy users will receive a discount on high energy bills until 31st March 2024.
Who does this help?
The Energy Bill Discount Scheme aims to help businesses locked into contracts signed before recent substantial falls in the wholesale price manage their costs. They reassure others against the risk of prices rising again.
For eligible business customers who have a contract with a licensed energy supplier, the government is announcing the following support:
- From 1st April 2023 to 31st 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.
- Subject to a wholesale price threshold, set regarding the support provided for domestic consumers, of £107/MWh for gas and £302/MWh for electricity. 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.
For eligible Energy and Trade Intensive Industries, the government is announcing the following:
- 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.
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(Information is correct as of 10/01/2023 from the gov.uk website.)