Energy bills to be cut for businesses, charities and public sector bodies

The new Business Secretary, Jacob Rees-Mogg, has announced support for businesses and public sector organisations facing rising energy bills in Great Britain and Northern Ireland.

This support is in addition to the Energy Price Guarantee (EPG) for households, with further measures today to strengthen support for families across the United Kingdom, including those in rentals or park homes.

Through a new Government 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 such as charities and the public sector including schools and hospitals) whose current gas and electricity prices have been significantly inflated in light of global energy prices.

This support will, the Business Secretary said, be equivalent to the EPG put in place for households.

The Government has set a Supported Wholesale Price — expected to be £211 per MWh for electricity and £75 per MWh for gas, less than half the wholesale prices anticipated this winter. 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 cover energy usage from 1 October 2022 to 31 March 2023, running for an initial six-month period for all non-domestic energy users. The savings will be first seen in October bills, which are typically received in November.

As with the EPG for households, customers do not need to take action or apply to the scheme to access the scheme. Support (in the form of a p/kWh discount) will automatically be applied to bills.

It should be noted, however, that the level of price reduction for each business will vary depending on their contract type and circumstances.

Non-domestic customers on existing fixed price contracts will be eligible for support as long as the contract was agreed on or after 1 April 2022. Those on default, deemed or variable tariffs will receive a per-unit discount on energy costs, up to a maximum of the difference between the Supported Price and the average expected wholesale price over the period of the Scheme.

“If you are not connected to either the gas or electricity grid, equivalent support will also be provided for non-domestic consumers who use heating oil or alternative fuels instead of gas,” the Department for Business, Energy and Industrial Strategy (BEIS) statement said. “Further detail on this will be announced shortly.”