The Energy Intensive Industries (EII) schemes boosting the UK’s competitiveness on a global scale

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In a bid to keep businesses within the UK Energy Intensive Industries (EII) competitive globally, the Government has recently introduced two new schemes to help this sector tackle their energy costs. Here’s what you’ll need to do to secure a significant reduction in your electricity costs…

Recent years have seen the UK’s EIIs facing the steepest industrial electricity prices in Europe, with Ofgem analysis finding that EIIs operating in Britain have been paying up to 50% more for their electricity in comparison to their competitors in France and Germany.

This puts UK EIIs at a globally competitive disadvantage as it not only damages their profits but also their potential for investment.

In response to these rising energy costs, the Government has recently introduced two new measures to support UK businesses operating in energy-intensive industries as part of its British Industry Supercharger (BIS): changes to the EII Renewable Levy Exemption Scheme and the EII Network Charging Compensation (NCC) Scheme.

What is the Energy Intensive Industries (EII) Levy Exemption Scheme?

The EII Exemption scheme was initially rolled out between autumn 2017 and spring 2018. As part of the UK’s pledge to achieve zero net emissions by 2050, a variety of Government schemes were introduced to encourage a shift to renewable energy across the economy. 

The levies funding this shift are covered by energy suppliers, however these costs are then passed down to consumers in their energy bills. Energy intensive businesses in the EU have much lower energy costs, setting the UK at a significant disadvantage from the outset.

And that’s where the EII Levy Exemption Scheme comes in. The scheme offers UK EIIs discounts on non-commodity charges. From 1 April 2024, the scheme’s discount on Renewable Obligations (RO), Feed-in Tariffs (FiT) and Contracts for Difference (CfD) will increase from 85% to 100%. 

These savings are estimated to add up to approximately 3p/kWh or £30/MWh. This discount will be applied directly to your bill by the supplier before you pay.

What is the EII Network Charging Compensation (NCC) Scheme?

The Network Charging Compensation (NCC) Scheme is a new scheme introduced to help EIIs tackle the large costs levied on them when using the GB energy grid. This includes costs such as BSUoS, TNUos and DUoS. These charges vary by meter and location, but make up a large proportion of these businesses’ energy spend.

The new scheme will reduce network charges for energy intensive businesses by 60%. Unlike other recent schemes, like the levy exemption scheme, the discount will not be applied in real-time. Instead, consumers will be able to claim compensation for any charges accrued as a rebate from April 2025.

To be eligible to apply for the 60% discount on the cost of network charges on your electricity bills, you’ll require an Energy Intensive Installation Certificate. You’ll then be able to make a claim through this online portal. Eligible companies should make a claim for charges incurred during April-June 2024 between 12 July and 30 August 2024. You’ll need to make network charging data claims submissions 4 times a year.

What other support is available?

You may be eligible for other schemes covered by the Government’s British Industry Supercharger measures. Find out what support is available for businesses in the energy intensive industries hereRead Flame Energy news. 

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