Businesses across the UK look to benefit from a new energy bill relief scheme, which will support businesses deal with rising energy costs.
Making up part of the Government's three-point energy plan, Chancellor Kwasi Kwarteng announced the intervention in his fiscal statement on 23 September.
Under the relief scheme, wholesale energy prices for all organisations will be capped for six months from 1 October.
It will also apply to all non-domestic energy customers in England, Scotland and Wales, while plans for an equivalent scheme for Northern Ireland are in the works.
The cap will limit prices to 7.5p per kWh for gas and 21.1p per kWh for electricity - a move the Government says will cut the wholesale price in half for the winter.
Anyone who had entered a fixed price contract that started after 1 April 2022 will be eligible for the scheme, as will anyone on a variable energy tariff. In most cases, these people will receive an automatic discount for the energy used.
Other support schemes
The energy bills relief scheme is just one of three schemes to alleviate the worst effects of skyrocketing energy prices.
Second, first announced during the first week of Liz Truss's tenure as Prime Minister, is the energy markets financing scheme.
Delivered in partnership with the Bank of England and worth £40 billion, the new scheme is being put in place to combat "volatile and erratic energy prices".
The scheme will open for applications on 17 October and will see a 100% guarantee to commercial banks covering additional lending extended to energy firms.
The third is the energy price guarantee for households, a two-year scheme that will mean the typical household using 12,000 kWh of gas and 2,900 kWh of electricity will pay no more than £2,500 a year on their energy bills (though this is dependent on energy).
The one-off payment of £400 to discount fuel bills will continue to go ahead for all households this winter, while those who don't use mains gas and electricity will receive an additional £100 on top.
In total, this energy support package is expected to cost between £130bn and £150bn, with the Government hoping that these measures will help reduce peak inflation.
Leaders praise new package
Industry leaders from across the UK have praised the decision to introduce this new energy support package.
Kitty Ussher, chief economist at the Institute of Directors, said:
"The[energy]package as a whole will make it easier for businesses navigating a challenging economic environment in the coming months."
Not only are business leaders pleased with the energy bill support package, but also the additional scrapping of the health and social care levy, which will reduce National Insurance contributions (NICs) for employers and employees.
Helen Dickinson OBE, chief executive of the British Retail Consortium, said:
"The Chancellor's announcements should help shore up consumer demand going into what will be a challenging winter for households and businesses.
"Retailers are facing immense cost pressures, not just from energy bills, but also a weak pound, rising commodity prices, high transport costs, a tight labour market and the cumulative burden of government-imposed costs.
"The energy bill relief scheme, set out earlier this week, and announcements on National Insurance and corporation tax will help retailers shield their customers from some of the effects of inflation."
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