The government has launched a new campaign to help organisations drive down their energy consumption after energy bill relief was slashed for tens of thousands of businesses.
The new Business Energy Efficiency campaign offers guidance on how organisations can boost their efficiency, cut costs and increase their cashflow through low-to-no cost energy-saving measures.
It was launched on 1 April, the same day that a new energy bill discount scheme came into place for businesses across the country.
What’s happening to energy bill relief?
The Energy Bill Discount Scheme (EBDS), which runs until 31 March 2024, extends government-funded energy bill relief for businesses for a further year but at significantly lower levels than the Energy Bill Relief Scheme (EBRS) it replaces.
In reality, only organisations that fixed their energy contract at the peak of the energy cost crisis in the second half of 2022 are now likely to be eligible for a discount on their bill, with the rest returning to market prices that are still significantly above pre-2021 levels.
Even those that are eligible will only receive a maximum discount of 2p/kWh for electricity and 0.7p/kWh for gas – a significant reduction on the relief previously available. A more generous discount system is available to those that qualify as ‘Energy and Trade Intensive’ industries, but in reality only a few hundred companies are likely to benefit.
‘Cliff-edge is here’
According to energy consultancy Cornwall Insight, in the worst case scenario businesses that locked in fixed bills during the peak of wholesale energy prices in 2022 could be facing up to a 133 per cent rise in their electricity costs from April.
“The cliff-edge we’ve been about warning for months is sadly here – tens of thousands of small firms are now at an existential risk as government energy support will largely downscale to a scheme that offers almost no help,” said Tina McKenzie, policy chair of the Federation of Small Businesses (FSB), which has called on the government to allow SMEs to renegotiate their energy contracts.
“We found that 24 per cent of small firms are trapped in fixed contracts, and of them, 28 per cent say they could be forced to downsize, close or restructuring their businesses. This equates to 370,000 small businesses.”
Simple actions to cut energy use
The scaling back of energy bill support is yet another reminder for businesses to take measures to reduce their consumption and cut their carbon footprint in the process.
The government believes a substantial number of UK businesses are missing out on “huge potential savings” due to a lack of information on how to cut down on their energy costs. Its new campaign outlines a range of possible actions organisations can take, from having better sight of energy consumption to upgrading and modifying equipment.
Lord Callanan, minister for energy efficiency and green finance, said: “Businesses, charities and public sector bodies can access helpful and practical advice on simple actions they can take to substantially reduce their energy use – and potentially increase profits.
“Not only will this help lower operational costs by up to hundreds of thousands of pounds, but smarter energy use will help us deliver on our critical pledges to cut demand by 15 per cent and reach net zero by 2050.”
Do you need energy efficiency support?
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