GovWire

The Energy Bills Discount Scheme will run for 12 months from 1 April 2023 to 31 March 2024.

This scheme replaces the Energy Bill Relief Scheme which supported businesses and organisations between 1 October 2022 and 31 March 2023.

About the scheme

The scheme is made up of 3 different parts:

1. The baseline discount will provide some support with energy bills for eligible non-domestic customers in Great Britain and Northern Ireland this support will be applied automatically

2. The Energy and Trade Intensive Industries (ETII) discount will provide a higher level of support to businesses and organisations in eligible sectors you will need to register to get this support

3. The Heat Network discount will provide a higher level of support to heat networks with domestic end consumers you need to register to get this support

Most eligible non-domestic customers receiving the baseline discount should expect to see it in their May bill.

The Energy Bill Discount Scheme will be established in regulations made under the Energy Prices Act 2022. The regulations are expected to come into force in late April 2023 and the scheme will not be finalised until then. However, the discount will apply to bills from 1 April 2023.

Eligibility for the EBDS baseline discount

The scheme will be available to everyone on a non-domestic energy supply contract with a licensed energy supplier including:

• businesses
• voluntary sector organisations, such as charities
• public sector organisations such as schools, hospitals and care homes

who are:

• on 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, or
• on flexible purchase (or similar) contracts
• on variable Day Ahead Index (DAI) tariffs (Northern Ireland scheme only)

Comparable support will be extended to non-domestic energy customers who receive gas or electricity delivered over public networks from non-licensed providers.

The support you may be eligible to receive

Most non-domestic customers will not see additional support on their energy bills from April and any support is likely to be significantly reduced. It is important that organisations continue to shop around for the best deals as the actual price you pay for your energy will vary between energy suppliers.

How the baseline discount is applied

Eligible non-domestic customers will receive a per-unit discount to their energy bills during the 12-month period from April 2023 to March 2024.This is subject to a maximum discount.

For most non-domestic energy users in Great Britain and Northern Ireland these threshold prices and maximum discounts have been set at:

• electricity - 19.61 per megawatt hour (MWh) with a price threshold of 302 per MWh.
• gas - 6.97 per megawatt hour (MWh) a price threshold of 107 per MWh

The discount is calculated as the difference between the wholesale price associated with an energy contract and the price threshold. The discount is phased in when the contracts wholesale price exceeds the floor price, until the total discount per MWh reaches the maximum discount for that fuel. The discount is only applied to the wholesale element of the bill and therefore the final per unit price paid by non-domestic customers will differ as it includes other costs such as network charges and operating costs, which is why it is important you continue to shop around to find the best deal.

EBDS legislation, rules and guidance

The Energy Prices Act 2022 provided government with the powers to:

• establish the EBDS
• ensure scheme benefits are passed on to consumers
• provide for an effective compliance and enforcement regime