To ensure the UK meets its low carbon targets, the government has introduced several policies that are driving renewable growth. The cost of electricity has also increased which has made UK prices higher than in other countries.
Certain Energy Intensive Industries (EIIs), including plastics, steel and mining, are exempt from a significant proportion of environmental subsidies to help them compete with EU counterparts.
The Department for Business, Energy and Industrial Strategy (BEIS) is consulting on widening the eligibility of charging relief for EIIs.
The aim is to discover whether lowering the electricity intensity test, a calculation to determine the percentage of electricity cost against Gross Value Added, would remove competitive distortions in the market.
Changes to qualification are not expected to come into force until 1st April 2020 at the earliest but could add another 1% onto electricity costs for non-exempt users.
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