The UK government has announced a bold 10-year plan to cut energy costs for businesses and boost economic growth. Moreover, the strategy includes exemptions from green levies, faster grid connections, and major investments in innovation.
Under the new British Industrial Competitiveness Scheme, over 7,000 manufacturers could see energy bills drop by up to 25%. Additionally, the plan removes certain green levies, saving firms £40 per megawatt-hour from 2027.
Meanwhile, 500 energy intensive industries like steel and chemicals will get bigger discounts. Currently, they receive a 60% reduction on network charges, but this will rise to 90% by 2026.
Prime Minister Keir Starmer called the strategy a “turning point” for Britain. He emphasized that it provides businesses with long-term certainty to invest and create jobs. Furthermore, the plan aims to generate over one million well-paid jobs in the next decade.
However, critics argue the plan reveals the high costs of net zero. Acting shadow energy secretary Andrew Bowie said it was “astonishing” that Labour now admits businesses need subsidies to survive.
The government also plans to speed up energy grid connections for new factories. Delays have long frustrated businesses, so this change could unlock major projects faster.
Additionally, the strategy includes £22.6 billion per year for research and development by 2030. This includes £2 billion for AI, signaling a strong push for tech innovation.
Eight key sectors will receive special attention, including clean energy, digital tech, and life sciences. Five of these will get detailed 10-year plans immediately, while the rest follow later.
To tackle labor shortages, the government will spend £1.2 billion more annually on skills training by 2029. Visa reforms will also attract global talent, reducing reliance on foreign workers.
Industry groups largely welcomed the plan. Make UK’s CEO praised its focus on skills, energy costs, and funding. The TUC also supported efforts to cut energy costs for businesses, noting the UK’s disadvantage compared to Germany and France.
Yet, some warn small firms must not be overlooked. Liberal Democrat Sarah Olney urged the government to ensure real solutions reach all businesses.
With the UK economy shrinking in April, this strategy marks a critical effort to revive growth. By aiming to cut energy costs for businesses, the government hopes to strengthen competitiveness and drive long-term prosperity.
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