Consultation on scheme aimed at cutting energy bills for 7,000 manufacturers

A consultation is set to be launched on the British Industrial Competitiveness Scheme, aimed at cutting electricity bills for 7,000 manufacturers by up to 25%.

Business Secretary Peter Kyle will announce the launch of an eight-week consultation for the British Industrial Competitiveness Scheme (Bics) that will determine eligibility in a speech at the CBI Conference in London.

The scheme will cut energy prices for thousands of businesses from April 2027, in industries including automotive and aerospace and foundational sectors in their supply chains, such as chemicals, the Department for Business and Trade said.

The Business Secretary will also back a new five-year plan for the Government-owned British Business Bank, ensuring it can invest larger amounts in successful domestic scale-ups, the department added.

This will increase the bank’s pace of investment by two thirds, with a £4 billion boost for the most promising businesses in industrial strategy sectors to scale up and stay here, according to the Department for Business and Trade.

Over five years, the bank’s total activities are projected to support 180,000 UK businesses, 370,000 new jobs, and add £68 billion of gross value added to the UK economy, the department added.

Mr Kyle said: “In recent years, our most promising innovators and industries have been hamstrung by some of the highest electricity prices in the G7 and poor access to finance. That’s been a drag anchor on growth, a drag anchor on innovation.

“I have listened to business on both these issues and today we’re taking action.

“This is just the start, and in the months ahead I will be going further to address business concerns, reverse our industrial decline and make the UK the best place to start and scale a business.”

The scheme will support hundreds of thousands of skilled jobs across the country, reducing eligible companies’ bills by around £35-£40 per megawatt hour, or up to 25%, the Department for Business and Trade said.

Uplift

Bics follows the uplift to the discount on electricity costs provided through the British Industry Supercharger scheme announced last month, which will launch in 2026 and increase the discount on electricity network charges faced by businesses in sectors such as steel, cement and glass from 60% to 90%, the department said.

Louise Hellem, CBI chief economist, said: “Businesses have long warned that soaring energy prices are not just a cost burden, they’re an investment barrier. This consultation marks another welcome step forward in tackling a significant drag on economic growth.

“Supporting firms to electrify is also critical to accelerating the energy transition and safeguarding the UK’s industrial competitiveness.

“Government must now move quickly, in partnership with industry and energy suppliers, to set clear eligibility rules, delivery mechanisms and funding streams to close the industrial electricity price gap between the UK and its G7 peers.”