Britain to cut companies' energy bills in new industrial strategy

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5 hours ago

LONDON (Reuters) -Britain will aim to cut the electricity bills of thousands of companies under a new industrial strategy to be published on Monday, heeding calls from business to lower high energy costs that they say have damaged competitiveness and hindered growth.
Under an industrial strategy for the decade 2025-2035, the government plans to cut the bills of electricity-intensive manufacturers by up to 25% from 2027, a move it said could benefit more than 7,000 businesses.
The government has made boosting Britain's anaemic growth a key priority. But lawmakers and business leaders had highlighted the sky-high energy costs many companies face as a hindrance to that aim, with industry body Make UK saying government should scrap climate levies imposed on firms.
Britain has been under pressure to do more to support its key industries and bolster competitiveness as the United States and the European Union also seek to do likewise, in a trade landscape upended by U.S. President Donald Trump's tariffs.
Alongside the strategy, five sectoral plans for areas such as advanced manufacturing, creative industries and clean energy are also set to be published. The Industrial Strategy focuses on eight previously identified sectors of strength for Britain, which also include defence and financial services.
The government said it would exempt energy-intensive manufacturers from levies like the Renewables Obligation to boost their international competitiveness.
"Tackling energy costs and fixing skills has been the single biggest ask of us from businesses and the greatest challenge they have faced – this government has listened," Business Secretary Jonathan Reynolds said in a statement.
The government said the energy measures would be funded through reforms to the energy system, without raising household bills or taxes. The scope and eligibility for the scheme will be finalised after a consultation.
Make UK said the industrial strategy was a "giant and much needed step forward" that also tackled a skills shortage in Britain's workforce and access to capital. The Confederation of British Industry said it was an "unambiguous, positive signal" that would provide a "bedrock for growth"
The industrial strategy, Britain's first in eight years, will expand the state-owned British Business Bank's capacity to channel investment into smaller companies, and provide an extra 1.2 billion pounds ($1.61 billion) a year on skills by 2028-29.
The government added it would cut regulatory burdens on businesses, spend more on research and development and speed up planning processes.
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