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Energy-intensive Industries Electricity Support Package

Volume 728: debated on Friday 24 February 2023

Yesterday the Government brought forward a package of measures to address energy costs for our most energy-intensive industries, which include companies in important strategic sectors that attract significant investment into Great Britain such as steel, chemicals production and other foundational manufacturing.

The current cost differential in electricity between Britain and comparable neighbouring countries means businesses in these sectors based in the UK are finding it harder to remain competitive. The April 2022 British energy security strategy committed to address the issue of high prices. We are delivering on this commitment with a package of support to keep British industry competitive, protect jobs across the country and incentivise large manufacturers to stay and scale up their businesses in Great Britain. The measures will help attract and sustain investment, particularly for nascent, internationally mobile sectors such as gigafactories, for which high energy costs are regularly cited as a critical factor in decision making for inward investment.

The Government have identified three key features of the domestic energy system which together contribute to higher costs than comparable countries and which we now intend to address via the following package of measures:

a. An increase from 85% to 100% relief from the costs of the renewable levies

b. 100% exemption from capacity market charges

c. Relief from eligible network charging costs

We will consult in spring 2023 to gather feedback from industry on how best to deliver capacity market and network charging changes.