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Energy Bills Discount Scheme (EBDS)

The Government has announced a new Energy Bills Discount Scheme (EBDS) for businesses. This will run from 1 April 2023 to 31 March 2024, once the current Energy Bill Relief Scheme (EBRS) ends on 31 March 2023. They designed the new scheme to strike a balance between supporting businesses and limiting taxpayer’s exposure, with a cap set at £5.5 billion based on estimated volumes.

The sector energy specialists such as Ginger Energy and Drax Energy are still in ongoing conversations with BEIS about how this will work, and how it will be applied to your bills and different contract types.

What will the discount be?

During the 12-month scheme, suppliers will apply discounts to eligible customers’ electricity unit prices up to a maximum discount of £19.61/MWh for electricity.

They will calculate discounts using the wholesale price associated with an energy contract and a price threshold of £302/MWh for electricity. Contracts below this threshold will not be eligible for support.

When will the discounts be applied?

Discounts will apply to energy usage between 1 April 2023 and 31 March 2024, based on the wholesale price of energy.

Energy and Trade Intensive Industries

The Government has identified energy intensive users who are more vulnerable to higher prices and will receive a larger discount. A list of these industries can be found here: Energy and Trade Intensive Industries (ETIIs). They’ll receive a discount of £89/MWh for electricity above price thresholds of £185.

ETII customers will have to apply to the Government for this higher level of support. We expect further details on this soon.

Energy Bills Discount Scheme (EBDS)

Who is eligible for EBDS?

Eligibility remains the same as EBRS with discounts available to businesses:

  • On fixed price contracts agreed on or after 1 December 2021
  • Deemed/out of contract/variable tariffs
  • Flexible contracts

How will you apply the discount?

Suppliers will automatically apply the price reduction to customer’s bills which will show as a separate discount for customers to clearly see.

What happens next?

When we have more information on how EBDS will work we will let you and share examples of the customer communications with you.

Credit: Thanks to our friends at Ginger Energy and Drax Energy for this information

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