Insights / Energy Bill Relief Scheme: What you need to know

Energy Bill Relief Scheme: What your business needs to know

5th December 2022

We’re working closely with the Government to implement the Energy Bill Relief Scheme and will continue to update this page as more information is confirmed.

The UKs amid an energy crisis, with supply struggling to meet demand and prices soaring. We’re aware that the knock-on effects are having an impact on organisations of all sizes, and we want to do what we can to support you.

The Government has recently announced its support package for businesses: the Energy Bill Relief Scheme. The scheme will ‘see energy prices for non-domestic energy customers such as businesses, charities and public sector organisations cut – protecting them from rising energy costs’.

Keep reading to understand what the Energy Bill Relief Scheme is and how it’ll work for you.

Learn more about why energy prices are increasing, what costs are in your energy bill and how Drax is delivering energy security.

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What is the Energy Bill Relief Scheme?

The Energy Bill Relief Scheme provides discounts to energy usage for UK businesses, charities and public sector organisations.

Discounts to energy usage will be applied from 1 October, through to 31 March 2023 initially. BEIS will review the scheme after three months to inform future support decisions.

Eligible customers don’t need to do anything - the discount will be automatically applied to your bill.

Who’s eligible?

The scheme is available to everyone on a non-domestic contract including businesses, voluntary and public sector organisations who are:

  • On most existing fixed price contracts that were agreed on or after 1 December 2021
  • Signing new fixed price contracts
  • On deemed/out of contract or variable tariffs
  • On flexible purchase or similar contracts
  • Contracts renewing during the 6 month term of the Energy Bill Relief Scheme

If you’re on a Fixed contract and the wholesale price was below the Government Supported Price at the time you entered into your contract, you won't receive a discount. Read more about eligibility.

What discount will I receive on my bills?

The Government will provide a discount on your gas and electricity unit prices by setting a ‘government supported price’. For all non-domestic energy users in Great Britain this government supported price has been set at:

  • £211 per megawatt hour (MWh) for electricity
  • £75 per MWh for gas

These prices are less than half the wholesale prices predicted this winter.

It’s difficult to work out what discount you’ll get on your energy bills because the Government Supported Prices are wholesale prices. Wholesale prices are what energy suppliers pay to purchase the energy. They are not retail prices, which is what end-users pay. Retail prices include other costs such as supplier margins, network costs and green levies.

How the discount will be applied depends on the type of contract you’re on:

  • Customers on fixed contracts: provided that the wholesale element is above Government Supported Price, your per unit energy costs will be reduced by the relevant p/kWh for the duration of the scheme. See an example of how it'll look on your Fixed contract bill here.
  • Customers on variable or flexible tariffs: you’ll receive a per-unit discount on energy costs based on the difference between the Supported Wholesale Price and the Average Expected Wholesale Price over the period of the Scheme, up to a Maximum Discount of 34.5p per kWh for electricity. See an example of how it'll look on your Flex contract here, and your Variable contract here.

When will I see a reduction on my energy bill?

We’re working closely with the Government to implement the scheme, which has now become law. This means we’re now able to reflect the proposed discount in bills.

If you’re an eligible customer, you don’t need to do anything as the discount will be applied automatically to your bill.

I’m still worried about my energy costs

We understand this is a difficult time, and we’d like to do what we can to help. If you’re worried about managing your energy payments, please contact us. We’ll work with you to come up with a management plan.

Additionally, charities like Business Debtline give free and independent advice, online and over the phone.

You can find out further useful information and support on our dedicated help page.

Find out more

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