The new "Energy Bill Relief Scheme" is designed to “provide energy bill relief for non-domestic customers in Great Britain”. Northern Ireland is still awaiting an announcement; however a “similar scheme” has been promised. 

Please note, this scheme is automatic and any request for your details to “sign up” is likely to be a scam. 

A Government Supported Commodity Price (cap) will be introduced to limit the amount that the suppliers can invoice at a pence per kilowatt hour level. This cap effects the Commodity Price only.

As previously announced, this cap will apply to all consumption between 1^st October 2022 – 31^st March 2023 (inclusive).

This Government Supported Commodity Price, which is to be confirmed, is expected to be £211/MWh (21.1 p/kWh) for Electricity and £75/MWh (7.5p/kWh) for Gas. This cap is to apply to any fixed price contract agreed on or after 1st April. The wording of the release suggests that this would also apply to other common supply agreement methodologies (flexible, variable, deemed) entered into at any time.

The precise level of support will vary based on the specific commodity rate achieved per the contract itself, and although unclear in the current release, could be subject to a “Maximum Discount”.

The Maximum Discount is not confirmed at this stage and is described as a methodology only of “the difference between the Commodity Price Cap and the average expected wholesale price over the period of the Scheme”. This is anticipated to be in the region of £405/MWh (40.5p/kWh) for Electricity and £115/MWh (11.5p/kWh) for Gas.

The Maximum Discount will be determined at “the start of the scheme”.

Fixed Price Agreements (signed prior to 01/04/22)

There is no change, your contract takes precedence.

Fixed Price Agreements (Signed 01/04/22 onwards)

The government will publish the wholesale prices that will be used for calculating the discount applied for each day from 1 April 2022 (based on the precise wording in the current information, this would not appear to be impacted by any Maximum Discount).

Flexible Price Agreements

The commodity price is, traditionally, a separate line item on your invoice.

This will be reduced to the lower of either:

1. the commodity price achieved,
2. the government supported commodity price or,
3.  the commodity price achieved minus the Maximum Discount (only applicable if your commodity price achieved is above the sum of the government supported commodity price and the Maximum Discount).

The commodity price seen on your invoice may be inclusive of additional supplier charges.

Deemed Rates / Out of Contract

The commodity rate applicable to Deemed/Out of Contract rates will vary based on the difference between the government supported price and relevant wholesale price (subject to the Maximum Discount).

If you already have a contract covering all or part of the upcoming winter (1^st October 2022 – 31^st March 2023):

From the currently available information, it seems that no action is required.

If you are yet to agree a contract covering all or part of the upcoming winter (1^st October 2022 – 31^st March 2023):

It is recommended that you seek a contract to gain as much clarity of pricing over the upcoming winter as a minimum. If your business requires a higher level of certainty for the summer period also, a longer duration should be considered.

If you have any questions or concerns, please reach out to your Account Manager or Procurement Contact within Optimised.