The UK Government has promised to help businesses with their energy bills for another year, but significantly reduced the amount of support they will receive. Ministers said that non-domestic customers including businesses, charities and schools, will get up to £6.97 taken off their energy bills for every megawatt hour (MWh) of gas they use.
Electricity bills will also be discounted by up to £19.61 per MWh. The Energy Bills Discount SchemeIt will deliver billions of pounds of support to companies over the 12 months from April 1, 2023 to March 31, 2024, however it is considerably less generous than the support they currently get.
The current scheme is set to cost the UK Government about £18 billion over just six months, compared with £5.5 billion over a whole year for the new plan. The Treasury said this provides long-term certainty for businesses and reflects how the scale of the challenge has changed since September last year.
The Government also announced that energy-intensive users, such as some factories that burn a lot of gas, will get extra support.
Those businesses that are eligible will get a maximum discount of £40 per MWh of gas and £89.10 per MWh of electricity. It will apply to 70% of their energy use by volume.
Chancellor of the Exchequer Jeremy Hunt said: "Wholesale energy prices are falling and have now gone back to levels just before Putin's invasion of Ukraine. But to provide reassurance against the risk of prices rising again we are launching the new energy bills discount scheme, giving businesses the certainty they need to plan ahead.
"Even though prices are falling, I am concerned this is not being passed on to businesses, so I've written to Ofgem asking for an update on whether further action is needed to make sure the market is working for businesses."
Although it was welcome, the original energy support package for businesses was always seen as a short-term measure.
It was first announced in September under then prime minister Liz Truss. But while the Government promised to support households for two years, non-domestic customers were told their support would run out in just half a year.
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.
Find out more about the changes to the Energy Bills Discount Scheme on GOV.UK here.
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