Member Article

Chamber warns longer term support needed for businesses following energy price cap

Business leaders across Coventry and Warwickshire have welcomed the capping of wholesale energy prices for businesses for the next six months – but have warned longer-term help is needed.

The Government’s Energy Bill Relief Scheme will take effect from October 1 for all non-domestic energy customers in England, Scotland and Wales.

The scheme has set a cap of 21.1p per kWh for electricity, and 7.5pm per kWh for gas when the current wholesale prices for both are 60p and 18p respectively.

Corin Crane, Chief Executive of the Coventry and Warwickshire Chamber of Commerce, said: “Businesses with a strong order book are being tipped into losses as their energy bills go up, and as a result are considering whether they are viable anymore, so we are pleased that the new government is taking the issue seriously and we welcome this latest announcement.

“This intervention will help many businesses over the difficult winter period and we will be campaigning hard to make sure that this support package is extended beyond six months and until global prices have stabilised.

“What this crisis has highlighted, though, is the fragile nature of the UK energy supply and our dependence on unsustainable fossil fuels. We can’t take our eyes off the Net Zero agenda and this short-term intervention needs to be backed up quickly with an ambitious and innovative package of sustainable options.

“We need huge investment in wind and solar generation at a national level and wherever possible we need to use UK suppliers to build and install this technology.

“We need financial support and planning flexibility for UK businesses to invest in onsite generation for their own supply and to enable them to put surplus green energy back into the system.

“Most importantly, in the West Midlands, we need proper devolved powers and budgets to deal with many of these issues ourselves – including grants to support businesses with energy efficiency programmes, powers to reclassify West Midlands manufacturers from energy network levies, and a huge acceleration in the move to battery and hydrogen powered transport networks.”

Shevaun Haviland, Director General of the BCC, added: “For months we have been calling for Government intervention to help businesses with eye watering energy bills. This support package is significant and will ease the cost pressures that have been piling up on businesses. 

“It will allow many firms that were facing closure, or having to lay off staff or reduce output, to keep going through the winter. 

“But the exact level of support will vary greatly from business to business depending on the detail of its contract, so some will inevitably do better than others. “We now need action to get this saving passed onto business as soon as possible – every day will put some firms closer to the edge and they cannot hang on much longer. 

“There must also be effective legal oversight to ensure no firms that are due this money miss out. 

“For those that will benefit, six months support is not enough to make plans for the future.

“We understand there are a range of unknowns for the Government in looking ahead, but without further reassurance very few firms will make plans to invest or grow.   “Some businesses will still struggle to meet their bills despite this government intervention, the Chancellor must prioritise those firms in his mini-budget on Friday. 

“There are a range of other challenges that must be addressed including labour shortages, supply chain disruption, and rising raw material costs.  “To truly revitalise our economy for the difficult months ahead then there must be a clear long-term plan that gives business the confidence to grow.”

This was posted in Bdaily's Members' News section by Matt Joyce .