67% of large businesses believe the Energy Bills Discount Scheme (EBDS), set to be introduced from 1 April 2023, won’t go far enough to support them amid the energy crisis.
Revealed as part of the 2023 Business Energy Tracker released by npower Business Solutions, the EBDS government scheme, which sets electricity at £19.61 per MWh with a price threshold of £302 per MWh and gas at £6.97 per MWh with a price threshold of £107 per MWh, will not support businesses enough over the next 12 months.
The report stated that for most businesses, the EBDS will result in a much lower level of support compared to the current scheme, the Energy Bill Relief Scheme (EBRS). Nearly one in five (19%) believe that the government should keep the EBRS until March 2024, despite the cost to the economy in doing so.
The need for financial support amid soaring energy bills is vital to help protect British businesses from the volatility of the energy market. The EBRS scheme had successfully provided support since being introduced last year, however, more must be done to ensure businesses are protected.
This is recognised by many large businesses with over half (52%) of respondents believing that continued financial support for businesses should be a top priority for the government with nearly three quarters (75%) believing a longer-term strategy is needed. This has led to the respondents calling for more incentives to help them reduce overall energy demand.
“This year’s report reveals that energy is the top concern for UK businesses for the second year running, with 64% saying it will be the biggest risk they will face over the next 12 months, and three quarters (72%) anticipating that the cost of energy to their business will keep rising,” said Anthony Ainsworth, chief operating officer at npower Business Solutions.
“Energy is also now a bigger board-level concern than in 2022, with 91% saying the c-suite was either very or quite concerned about energy at the moment, compared to 80% a year ago. This shows that the uncertainty over the past 12 months has naturally had an impact on business confidence, which is why they need policy clarity and consistency to help them plan ahead.
“For example, since our last Business Energy Tracker in 2022, we have had three Prime Ministers, four Chancellors of the Exchequers and three Secretary of States for Business, Energy and Industrial Strategy. We also now have a new governmental department – the Department for Energy Security and Net Zero (DESNZ).
“The results from this year’s research show why DESNZ has to double down on supporting businesses through energy efficiency strategies and more incentives to reduce demand. While additional immediate financial support would obviously be welcome, businesses want to start planning for the longer-term as well.”