Energy Bill Support For Businesses, Schools And Hospitals Explained

Bills will be capped at "less than half" the market rate - but there are worries about what happens after six months.
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Liz Truss has announced plans to give support to non-domestic users of energy to help pay their soaring bills.

This is how the new Energy Bill Relief Scheme is supposed to work.

 

What is being offered?

Bills will be capped at “less than half” the market rate anticipated for the coming winter.

It means wholesale prices are expected to be at £211 per MWh for electricity and £75 per MWh for gas.

 

Who does it apply to?

The scheme will cover all businesses, the voluntary sector like charities and the public sector such as schools and hospitals.

 

How long will it last?

The help will be in place for six months, from October 1, 2022 until March 31, 2023. 

The savings will be first seen in October bills, which are usually received in November.

How much will it cost? 

The government has not said how much the intervention will cost the taxpayer, but it will be a multi-billion pound package. This is because it will depend on what wholesale prices end up being during the period of the scheme. 

 

What next?

In three months time the government will announce a review of the scheme and reveal what if any help will continue to be provided beyond March 2023. 

 

What does business say?

Business groups have broadly welcomed the intervention. Martin McTague, the national chair of the Federation of Small Businesses, praised the government for taking “decisive action” and having “got this big call right”.

But there is unease at what happens after six months. Kate Nicholls, the CEO of UKHospitality said the scheme was “extremely welcome” but warned there must be “no cliff edge” of support.

And James Lowman, the chief executive of the Association of Convenience Stores added the group wanted to ensure there were “longer term solutions to the energy crisis”.

What do the opposition parties say? 

Jonathan Reynolds, Labour’s shadow business secretary, said the “dither and delay” in announcing the scheme had already “forced too many businesses to close”.

“Businesses have been crying out for detail on these plans and, even now, there are still questions about how much this will cost and who will pay for it,” he said.

Sarah Olney, the Lib Dem Treasury spokesperson, said the help was a “temporary sticking plaster” that had come “too late”.

“The government have no plan beyond these next six months, paralysing businesses who need to make decisions for the long term,” she said.

“Support for high streets and public services should be in place for at least the next year and include measures to improve energy efficiency and cut bills in the long term.”

What about households?

Plans have already been announced plans to freeze household energy bills from October 1.