Wholesalers criticise the new Energy Bills Discount Scheme

The FWD has expressed its disappointment following the Chancellor’s announcement about a new energy bills support package, effective from April.

James Bielby: ‘This level of support does not offer much help to any businesses.’

The new Energy Bills Discount Scheme for UK businesses will come into effect when the current scheme ends on 31 March 2023 and provide a discount on high energy costs until 31 March 2024.

All eligible non-domestic customers will see unit discounts of up to £6.97/MWh automatically applied to their gas bill and up to £19.61/MWh applied to their electricity bill.

“This level of support does not offer much help to any businesses, especially those who are vulnerable due to high energy bills,” commented FWD chief executive James Bielby.

“The wholesale energy price will probably fall below the 30.2p per kwh threshold due to market forces, and therefore few businesses will get help, except those who signed fixed contracts at way above that level in 2022. However, the discount is so small it won’t make a huge amount of difference, and they will still be paying much higher energy bills than this time last year.”

He continued: “The Government has also taken the easier option in giving blanket support, rather than taking into account the vital nature of food distribution and the unavoidably high energy consumption that it involves, and supporting it accordingly. Food and drink supply to households and public services will be disproportionately affected by rising costs,  so we will continue to work with Government to make the case for bespoke support for wholesalers.

“If we are looking for positives, there is now extra incentive for wholesalers to look for ways to be more energy efficient.”

Andy Needham: ‘The next six months will be carnage.’

Andy Needham, managing director of Surplus Group, Morris & Son and Approved Food, is one wholesaler that has taken to social media to spell out the impact of the reduced support package on his businesses – and voice his contempt: “Our cost of electricity has gone up from 16p/kwh to 82p/kwh – a five-fold increase. The Government’s six-month wholesale cost support reduces that cost to 52p/kwh until March, still over triple the previous level… The next level of ‘support’ for our circumstances is a discount of 1.96p/kwh off the new rate of 82p/kwh, reducing it to 80.4p/kwh.

“I’d normally like to thank people for helping but in this instance they can stick it…so far out of touch it’s untrue. My sympathies go out to employers who are losing their businesses and employees who will be out of work. The next six months will truly be carnage.”

He added: “We have undertaken a slew of actions to reduce consumption and become more efficient: every bulb is LED, rewired electrical circuits to cut out unnecessary consumption, installed timers on every bit of equipment that can be recharged overnight, and well down the track with our landlord to install SolarPV, etc. Just hate to see a country and its essential services being so badly managed.”

Published Date: January 10, 2023

Category: Wholesale Industry News