Energy and Business Secretary Kwasi Kwarteng announced a proposal to provide additional relief for energy intensive industries in a statement released today.
Companies with a high rate of electricity usage, such as steel and paper mills, were suggested as contenders for new proposals to subsidise electricity costs under a consultation for the Energy Security Strategy.
Kwarteng said the UK government was currently consulting on the option to raise the level of exemption for select environmental and policy expenses from 85% to 100%.
The rationale behind the new proposal reflects the higher UK industrial electricity prices against the rest of Europe, which the Conservatives fear risk hampering investment and competition for business including paper, glass, steel and ceramics across the UK.
“British manufacturers are the lifeblood of our economy and central to our plans to overcome this period of economic uncertainty,” said Kwarteng.
“With global energy prices at record highs, it is essential we explore what more we can do to deliver a competitive future for those strategic industries so we can cut production costs and protect jobs across the UK.”
According to the statement, the suggested plans would help approximately 300 businesses and support 60,000 jobs in the country’s industrial heartlands.
“The publication of this consultation is a significant step forward in delivering competitive electricity prices for the UK steel sector and should provide some much-needed relief in the face of extremely challenging circumstances at the current time,” said UK Steel director general Gareth Stance.
“While there remain difficulties, this announcement demonstrates that UK government understands the challenges of British industry and continues to support steelmakers and steel communities across the country.”
The government has so far provided over £2 billion to support businesses in energy intensive sectors with energy prices since 2013.