How the Energy Bill Relief Scheme will affect SME.
The government has announced (21 September) a new scheme that will see energy prices for non-domestic energy customers such as businesses, SME, charities and public sector organisations cut. The Energy Bill Relief Scheme (EBRS) will offer discounts for all firms for six months from 1 October 2022.
Energy Bill Relief Scheme
The government’s Energy Bill Relief Scheme (EBRS) will provide a discount on wholesale gas and electricity prices for all non-domestic customers whose current gas and electricity bills have been significantly inflated in light of global energy prices. This support will be equivalent to the Energy Price Guarantee put in place for households.
The EBRS applies to fixed contracts agreed on or after 1 April 2022, as well as to deemed, variable and flexible tariffs and contracts. It will apply to energy usage from 1 October 2022 to 31 March 2023, running for an initial six-month period for all non-domestic energy users. The savings will be first seen in October bills, which are typically received in November.
SME customers do not need to apply to the scheme or contact us. We will implement the changes set out by the government automatically to your E.ON Next account.
The government has set a Supported Wholesale Price – expected to be £211 per MWh for electricity and £75 per MWh for gas, less than half the wholesale prices anticipated this winter – which is a discounted price per unit of gas and electricity. It includes the removal of green levies paid by non-domestic customers who receive support under the scheme.
The level of price reduction for each business will vary depending on your contract type and circumstances:
Non-domestic customers on existing fixed price contracts will be eligible for support as long as the contract was agreed on or after 1 April 2022. Provided that the wholesale element of the price the customer is paying is above the Government Supported Price, their per unit energy costs will automatically be reduced by the relevant p/kWh for the duration of the scheme. Customers entering new fixed price contracts after 1 October will receive support on the same basis.
Those on default, deemed or variable tariffs will receive a per-unit discount on energy costs, up to a maximum of the difference between the Government Supported Price and the average expected wholesale price over the period of the scheme. The amount of this maximum discount is likely to be around £405/MWh for electricity and £115/MWh for gas, subject to wholesale market developments. Non-domestic customers on default or variable tariffs will therefore pay reduced bills, but these will still change over time and may still be subject to price increases. This is why the government is working with suppliers like us to ensure all customers in England, Scotland and Wales are given the opportunity to switch to a fixed contract/tariff for the duration of the scheme if they wish, underpinned by the government’s Energy Bill Relief Scheme support.
For businesses on flexible purchase contracts, typically some of the largest energy-using businesses, the level of reduction offered will be calculated by suppliers according to the specifics of that company’s contract and will also be subject to the maximum discount.
Contact our Energy Specialists if you’re having difficulty.
Our Energy Specialists are here to help you if you’re concerned about your energy bills. You can reach out to our Energy Specialists for advice on Facebook and Twitter.
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