Firms on variable/flexible contracts will be contacted by their suppliers and invited to choose whether they wish to move to fixed contracts. This is stated in further government detail about how its Energy Bill Relief Scheme (EBRS) will work over the six months from October 1.
Non-domestic energy suppliers will be compensated “for the reduction in wholesale gas and electricity unit prices that they are passing onto non-domestic customers”. The discount applied will be in pence per kilowatt hour (p/kWh).
For fixed contracts, the discount will reflect the difference between the government supported price and the relevant wholesale price for the day the contract was agreed. The government will publish the wholesale prices used for calculating this for each day from 1 April 2022.
For variable, deemed and all other contracts, the discount will reflect the difference between the government supported price and relevant wholesale price, but be subject to a ‘maximum discount’ that “will determined at the beginning of the scheme”.
Businesses on variable / flexible contracts will be invited to choose if they move to fixed contracts.
Third party intermediaries/energy brokers have no influence over the per unit cost reductions that will be applied to energy costs under the scheme, the government says.
Business groups across the economy are urging continued support for their sectors when current arrangements end, at the end of March 2023. BEIS secretary Jacob Rees-Mogg is conducting a three-month review, to identify those firms most vulnerable to energy price increases.
BEIS has asked EAMA to continue to provide information and opinion and we welcome feedback on the government support scheme.
We also welcome continuing feedback on measures and investments to reduce energy use. We know many firms in the machinery and component supply chain are taking action.
Don’t forget you can also check out our webinar from a few weeks ago on the topic at: https://www.youtube.com/watch?v=2wP3qvzKxBQ