Over 7000 businesses could see their electricity bills slashed by up to 25% from 2027 under plans set out in the Government’s new Industrial Strategy.
Electricity costs will be reduced by around 25% for over 7000 electricity-intensive businesses in manufacturing sectors such as automotive, aerospace and chemicals from 2027 by exempting them from paying green levies such as the Renewables Obligation, Feed-in Tariffs and the Capacity Market.
The Government is also increasing support for the most energy-intensive firms, such as steel, chemicals and glass by increasing the discount on electricity network charges they pay through the British Industry Supercharger from 60% to 90% by 2028. British intensive energy users currently pay some of the highest prices in Europe; the added discount will further reduce electricity bills and help around 500 UK businesses stay competitive against European and international counterparts.
Announcing the energy savings, Business and Trade Secretary Jonathan Reynolds said: “Tackling energy costs and fixing skills has been the single biggest ask of us from businesses and the greatest challenge they’ve faced.”
The cuts in business energy costs form a key part of the Government's longer-term 10-year Industrial Strategy, which Prime Minister Sir Keir Starmer said “marks a turning point for Britain’s economy”.
The strategy aims to promote business investment and growth and make it quicker, easier and cheaper to do business in the UK. Eight growth-driving sectors have been identified: advanced manufacturing, clean energy industries, creative industries, defence, digital and technologies, financial services, life sciences, and professional business services, with each sector having its own 10-year plan for attracting investment, enabling growth and creating jobs.
“In an era of global economic instability, it delivers the long-term certainty and direction British businesses need to invest, innovate and create good jobs that put more money in people’s pockets as part of the plan for change,” the prime minister added.
The Government’s Industrial Strategy Sector Definitions List is available HERE.
