More big energy users to get help as support plan expanded

More Big Energy Users to Get Help as Support Plan Expanded

The government has pledged additional assistance to a larger number of businesses starting in April 2027, following the announcement of an expanded initiative initially proposed in 2025. This measure targets approximately 10,000 energy-demanding manufacturers across industries like steel and pharmaceuticals, potentially reducing their energy expenses by up to a quarter. Originally, the British Industrial Competitiveness Scheme (BICS) was designed to aid 7,000 firms, but the expansion aims to address the growing financial strain caused by recent energy price increases.

Amid the rising costs of oil and gas, the government emphasized the importance of bolstering economic resilience. However, some critics argued the plan was insufficient. The Conservative Party highlighted that sectors such as pubs, restaurants, farmers, and retailers—already facing significant challenges—would be excluded from the support. “When global instability puts businesses under pressure, we’ll always do what’s needed to support them and ensure Britain’s resilience,” stated Business Secretary Peter Kyle in a blockquote.

“When global instability puts businesses under pressure, we’ll always do what’s needed to support them and ensure Britain’s resilience,” said Business Secretary Peter Kyle.

The expanded scheme will exempt qualifying firms from certain electricity charges that fund the net zero transition, amounting to £35–£40 per MWh. Additionally, these businesses will receive a single payment in 2027 to offset the support they would have received had BICS been active from April 2026. Funding will come from adjustments to the energy system and government spending, without affecting household energy costs.

Energy prices surged following the start of the Iran conflict, though they did not peak as dramatically as after Russia’s invasion of Ukraine. Both gas and oil prices have since eased from their highest points, driven by optimism about the conflict’s resolution. Despite this, UK businesses still pay electricity rates up to double those of US companies and 50% more than EU counterparts.

Industry leaders have welcomed the expansion, with the Confederation of British Industry’s chief executive, Rain Newton-Smith, calling it “a significant step” and noting the government had been attentive to their concerns. The initiative supports companies in high-energy sectors such as automotive, aerospace, steel production, pharmaceuticals, recycling, plastics, nuclear fuel processing, and cooling equipment manufacturing. However, others argue more action is required to alleviate the broader energy cost crisis, which affects firms of all sizes.

The plan is set to cost £600 million, with businesses using their Standard Industrial Classification codes to determine eligibility via the government business department’s website. Shadow energy secretary Claire Coutinho criticized the plan, stating it would benefit only 0.2% of firms and suggested reducing green levies to lower electricity prices as a more effective solution.