The UK government has recently introduced a new Energy Bills Discount Scheme, which aims to assist eligible non-domestic energy customers, such as businesses, charities, and public sector organisations. The scheme, which will replace the current Energy Bill Relief Scheme, will operate from 1 April 2023 to 31 March 2024.
What is the new scheme’s objective?
The new business Energy Bills Discount Scheme has been established to provide assistance to UK businesses over the next year while limiting taxpayer exposure to volatile energy markets. The scheme has a budget limit of £5.5 billion based on the estimated volume required to achieve this goal.
Who is eligible for the scheme, and what benefits are there?
Non-domestic customers with a contract with a licenced energy supplier will receive a unit discount of up to £6.97/MWh automatically applied to their gas account, with a price threshold of £107/MWh. In addition, a unit discount of up to £19.61/MWh will be applied to their electricity account, with a price threshold of £302/MWh. However, the relative discount will only be applied if wholesale prices exceed the thresholds specified.
Those industries, such as manufacturing, deemed to be the most energy- and trade-intensive, will receive a significantly higher level of support. These businesses will receive a discount on their gas and electricity bills based on a supported price, with a maximum unit discount of £40/MWh for gas with a price threshold of £99/MWh and £89/MWh for electricity with a price threshold of £185/MWh. This discount will only apply to 70% of total energy consumption.
Does the scheme have an application process?
As was the case with the original scheme, suppliers will automatically apply discounts to the bills of all eligible non-domestic customers; no application is required. However, businesses are encouraged to remain informed and up-to-date regarding the scheme’s most recent developments.
The new enterprise, The Energy Bills Discount Scheme, is a commendable initiative designed to aid British businesses over the next year while shielding taxpayers from the volatility of energy markets. Businesses struggling with the cost of energy, particularly those in the most energy-intensive sectors, will receive much-needed respite from this scheme. We at Peer Accountants encourage you to remain informed and take advantage of the scheme’s benefits to enhance your financial stability.