The existing Energy Bill Relief Scheme for businesses comes to an end in March 2023. It supports businesses and public sector organisations such as schools and hospitals by providing a discount on wholesale gas and electricity prices. The new Energy Bills Discount Scheme (EBDS) will run for 12 months from 1 April 2023 to 31 March 2024, but at a reduced rate.
As with the original scheme, the EBDS will be available to everyone on a non-domestic contract including businesses, public sector organisations such as schools, hospitals, and care homes and voluntary sector organisations, such as charities.
The discount will be applied if wholesale prices are above a certain price threshold. For most businesses these maximum discounts are:
- Electricity – £19.61 per megawatt hour (MWh) with a price threshold of £302 per MWh.
- Gas – £6.97 per MWh with a price threshold of £107 per MWh
Certain non-domestic energy users in Great Britain and Northern Ireland are especially vulnerable to excessive energy prices as a result of their energy intensive and trade exposure. Subsequently, these sectors will be eligible to receive a higher level of support and get the maximum discount. The maximum discounts and price threshold for these sectors are:
- Electricity – £89 per MWh with a price threshold of £185 per MWh
- Gas – £40 per MWh with a price threshold of £99 per MWh
Like the original system, all eligible non-domestic customers will have their bill reductions automatically applied by their suppliers. The level of support for each organisation will vary depending on type and date of contract.
The government claim that through this scheme they will compensate suppliers for the reduction in wholesale gas and electricity unit prices that they are passing on to non-domestic customers.
Who is eligible? – The new scheme will be available to everyone on a non-domestic contract including businesses, voluntary sector organisations, such as charities, public sector organisations such as schools, hospitals, and care homes.
These businesses need to be on existing fixed price contracts (from 1 December 2021) or signing new fixed price contracts, out of contract or standard variable tariffs or flexible purchase contracts.
How do Businesses get the money? – Similar to the original scheme, suppliers will automatically apply reductions to the bills of for eligible businesses.
Whilst this short-term measure is encouraging and may prevent many businesses from closing, the initial six-month scheme from the government was worth £18bn for businesses and the new arrangement is just £5.5bn for EBDS. This reflects the radical change in fiscal policy as borrowing costs have risen. this reduced support from the government has raised concerns over how some businesses will cope.
However, EES Group is in a fantastic position to help businesses to significantly reduce their energy bills.
At EES Group, we offer a comprehensive range of energy efficient solutions that are tailored to each individual client. Unlike this government scheme, EES Group offers long-term solutions that are available to aid businesses in this economy and help them on their net zero journey. We offer a range of different technologies such as energy saving lighting, Solar PV, electric vehicle charging and heating.