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31st March 2023

Energy support for businesses to change from 1 April

Paul Butterworth, Interim CEO of Chambers Wales South East, South West and Mid, said:

“As of 1 April, support for businesses’ energy bills will drop by 85% as the Energy Bill Relief Scheme (EBRS) ends.

“It will be replaced by the Energy Bill Discount Scheme (EBDS) which will provide, on average, £400 per year, for SMEs while their energy bills are in the thousands per month. Larger energy intensive firms, such as Welsh manufacturers, will receive less of a reduction.

“While wholesale prices are reducing, businesses are not yet seeing that reduction. Therefore, the drop-off in support is a blanket rise in energy prices for sectors who do not meet the classification of energy intensive industries, like hospitality.

“The British Chambers of Commerce (BCC) has stated that 47% of UK businesses will find paying their energy bills difficult from 1 April. That represents over 125,000 businesses in Wales alone who will struggle.

Chambers Wales South East, South West and Mid are joining the BCC in calling for an increase in Ofgem’s powers to help better regulate the energy market for businesses.

“With inflation rising again, the end of the super deduction on 1 April and potential changes to business rates, firms cannot be expected to take on additional costs without significant risks.”


Alex Veitch, Director of Policy & Public Affairs at the British Chambers of Commerce, said:

We have been signalling for months that many businesses will struggle to afford their energy bills when financial assistance reduces by 85%, with many receiving a fraction of their original supportAlmost half (47%) of firms say paying bills will be difficult from tomorrow onwards.

But of the seven energy policies we advocated for the Government to include in this month’s Spring Budget, not one was acted upon.

“Flexibility to increase support for those who desperately need it – ignored. Easing the burden of claiming VAT on energy – ignored. Funding for improved business energy efficiency – ignored. And so the list goes on.

“Government also failed to heed our calls to increase regulation of the business energy sector. The energy crisis faced by firms and households are two sides of the same coin. Yet, non-domestic customers do not enjoy the same protection as households.

To ensure competition in the business energy sector, and solve market failures, Government must ensure Ofgem has the necessary powers to properly regulate the industry. We are also asking Ofgem and Government to introduce a ‘duty to supply’ mechanism to the non-domestic energy market, to ensure businesses can access fixed rates, providing them with certainty and stability.

Along with the reduction in energy support, businesses are facing several other changes in the business environment from tomorrow. Corporation tax is increasing, as is the national living wage, while a number of firms will see their business rates change due to revaluations.

These changes will have a significant impact, but Government is yet to offer any meaningful support to offset the challenges currently facing so many UK businesses.”

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