British Government announced that Energy Bill Relief Scheme currently provides a discount on wholesale gas and electricity prices for all non-domestic consumers, including public sector organizations, voluntary sector organizations like charities, and businesses. The scheme came into effect on 1 October 2022 and was always intended to run until 31 March 2023. The EBRS was designed as a temporary six-month measure to protect non-domestic consumers from soaring energy costs, cutting the cost of power bills and providing them with the certainty they needed to plan through the acute crisis this winter. The latest data shows wholesale gas prices have now fallen to levels just before Putin’s invasion of Ukraine and have almost halved since the current scheme was announced. The new scheme therefore strikes a balance between supporting businesses over the next 12 months and limiting taxpayer’s exposure to volatile energy markets, with a cap set at GBP 5.5 billion based on estimated volumes. The EBDS will run for 12 months from 1 April 2023 to 31 March 2024UK Steel’s Director General Mr Gareth Stace said “We welcome the announcement from the Government to launch the Energy Bill Discount Scheme, providing some important certainty and stability for steel producers’ production costs during this extremely difficult economic climate. However, there will be concerns that the newly announced support falls short of that of competitor countries, including Germany. Today’s reforms significantly narrow the help that Government will provide, with a maximum discount of GBP 89 per MWh, which stops delivering once those prices go beyond a ceiling of GBP 274 per MWh. The Government is betting on a calm and stable 2023 energy market, in a climate of unstable global markets, with the scheme no longer protecting against extremely volatile prices. The German Government guarantees an electricity price of EUR 130 per MWh for the whole of 2023, ensuring German industry can continue to operate competitively within Europe and beyond. In contrast, the reformed EBDS provides a discount for electricity prices above GBP 185 per MWh, leaving UK steel producers paying an estimated 63% more for power than German steel producers this year. This situation will maintain a long-standing competitive disadvantage for UK producers, resulting in higher production costs and a reduced ability to compete this year.”Mr Stace said “Given the disparity in relief provided in the UK and competitor countries, it is essential that the Government now delivers on its Energy Security Strategy and addresses the outstanding disproportionate costs UK steel producers face in electricity bills, including high renewable levies and network costs. Years of paying more for these elements of electricity costs have placed UK industry at a competitive disadvantage against its European and global competitors.”Mr Stace added “Steel demand and prices are falling in the UK and across Europe, while key input costs remain persistently high, leading to reduced production, shrinking market share, and increased imports for the UK. Whilst we are grateful and pleased to see that Government has acted to extend the scheme, there remains a vital gap in that delivery. We urge Government to take the next step and look to match what is provided in Germany for the most energy intensive industries.”
British Government announced that Energy Bill Relief Scheme currently provides a discount on wholesale gas and electricity prices for all non-domestic consumers, including public sector organizations, voluntary sector organizations like charities, and businesses. The scheme came into effect on 1 October 2022 and was always intended to run until 31 March 2023. The EBRS was designed as a temporary six-month measure to protect non-domestic consumers from soaring energy costs, cutting the cost of power bills and providing them with the certainty they needed to plan through the acute crisis this winter. The latest data shows wholesale gas prices have now fallen to levels just before Putin’s invasion of Ukraine and have almost halved since the current scheme was announced. The new scheme therefore strikes a balance between supporting businesses over the next 12 months and limiting taxpayer’s exposure to volatile energy markets, with a cap set at GBP 5.5 billion based on estimated volumes. The EBDS will run for 12 months from 1 April 2023 to 31 March 2024UK Steel’s Director General Mr Gareth Stace said “We welcome the announcement from the Government to launch the Energy Bill Discount Scheme, providing some important certainty and stability for steel producers’ production costs during this extremely difficult economic climate. However, there will be concerns that the newly announced support falls short of that of competitor countries, including Germany. Today’s reforms significantly narrow the help that Government will provide, with a maximum discount of GBP 89 per MWh, which stops delivering once those prices go beyond a ceiling of GBP 274 per MWh. The Government is betting on a calm and stable 2023 energy market, in a climate of unstable global markets, with the scheme no longer protecting against extremely volatile prices. The German Government guarantees an electricity price of EUR 130 per MWh for the whole of 2023, ensuring German industry can continue to operate competitively within Europe and beyond. In contrast, the reformed EBDS provides a discount for electricity prices above GBP 185 per MWh, leaving UK steel producers paying an estimated 63% more for power than German steel producers this year. This situation will maintain a long-standing competitive disadvantage for UK producers, resulting in higher production costs and a reduced ability to compete this year.”Mr Stace said “Given the disparity in relief provided in the UK and competitor countries, it is essential that the Government now delivers on its Energy Security Strategy and addresses the outstanding disproportionate costs UK steel producers face in electricity bills, including high renewable levies and network costs. Years of paying more for these elements of electricity costs have placed UK industry at a competitive disadvantage against its European and global competitors.”Mr Stace added “Steel demand and prices are falling in the UK and across Europe, while key input costs remain persistently high, leading to reduced production, shrinking market share, and increased imports for the UK. Whilst we are grateful and pleased to see that Government has acted to extend the scheme, there remains a vital gap in that delivery. We urge Government to take the next step and look to match what is provided in Germany for the most energy intensive industries.”
