Businesses will receive reduced support for their energy bills from April as the UK government attempts to cut the cost of compensating for soaring gas and electricity prices, the Treasury has confirmed.
The Treasury said that the government would provide £5.5 billion of ‘transitional support’ for businesses over 12 months from 1 April 2023.
Under the new scheme, firms will get a discount on wholesale prices rather than costs being capped as under the current one. Bills will automatically be discounted by up to £6.97 per megawatt hour (MWh) for gas bills and by up to £19.61 per MWh for electricity bills, a statement said.
Heavy energy-using sectors, like glass, ceramics and steelmakers will get a larger discount than others, but firms will only benefit from the scheme when energy bills are high.
The energy support scheme is mainly used by businesses, but is also for charities and public sector organisations such as schools and hospitals.
Chancellor Jeremy Hunt said: ‘My top priority is tackling the rising cost of living – something that both families and businesses are struggling with.
‘That means taking difficult decisions to bring down inflation while giving as much support to families and business as we are able.’