New support for households, businesses and public sector organisations facing rising energy bills in Great Britain and Northern Ireland has been unveiled by Business Secretary Jacob Rees-Mogg today (Wednesday 21 September) –aiming to support growth and prevent unnecessary insolvencies.
The energy bill relief scheme will fix gas and electricity prices for companies for six months from 1 October, in a bid to stop firms facing soaring costs from going bust.
Through the Energy Bill Relief Scheme, the government will provide a discount on wholesale gas and electricity prices for all non-domestic customers (including all UK businesses, the voluntary sector like charities and the public sector such as schools and hospitals) whose current gas and electricity prices have been significantly inflated in light of global energy prices. This support will be equivalent to the Energy Price Guarantee put in place for households.
It will apply to fixed contracts agreed on or after 1 April 2022, as well as to deemed, variable and flexible tariffs and contracts. It will apply to energy usage from 1 October 2022 to 31 March 2023, running for an initial 6 month period for all non-domestic energy users. The savings will be first seen in October bills, which are typically received in November.
The announcement comes after ministers announced a £150bn plan to help households with their soaring bills for two years.
Whilst industry groups have welcomed the package, they also warn that further support may be needed after the winter.
We understand that the scheme will be reviewed after three months with an option to extend support for “vulnerable businesses” – but as yet it is not known what sectors come under the category.
The detail:
- Wholesale prices are expected to be fixed for all non-domestic energy customers at £211 per MWh for electricity and £75 per MWh for gas.
- The scheme will apply to fixed contracts agreed on or after 1 April, and variable and flexible tariffs and contracts.
- Businesses do not need to contact suppliers as the discount will automatically be applied to bills, with savings seen from October but received from November.
The Prime Minister Liz Truss said the government understood the “huge pressure businesses, charities and public sector organisations are facing with their energy bills.
“As we are doing for consumers, our new scheme will keep their energy bills down from October, providing certainty and peace of mind.
“At the same time, we are boosting Britain’s homegrown energy supply so we fix the root cause of the issues we are facing and ensure greater energy security for us all.”
We are expecting more announcements this week when Kwasi Kwarteng delivers his emergency mini-budget on Friday 23 September and we will keep you informed.
Disclaimer
The information was correct at time of publishing but may now be out of date.
