{"id":1835,"date":"2025-11-27T16:47:55","date_gmt":"2025-11-27T16:47:55","guid":{"rendered":"https:\/\/leyton.majjane.agency\/uk\/insights\/articles\/how-do-budget-2025-the-new-british-industrial-competitiveness-scheme-bics-impact-business-energy-costs\/"},"modified":"2026-07-26T19:02:11","modified_gmt":"2026-07-26T17:02:11","slug":"how-do-budget-2025-the-new-british-industrial-competitiveness-scheme-bics-impact-business-energy-costs","status":"publish","type":"article","link":"https:\/\/leyton.com\/uk\/insights\/articles\/how-do-budget-2025-the-new-british-industrial-competitiveness-scheme-bics-impact-business-energy-costs\/","title":{"rendered":"How do Budget 2025 & the new British Industrial Competitiveness Scheme (BICS) impact business energy costs?\u00a0"},"content":{"rendered":"\t\t
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Budget 2025 has landed. While many had been hoping for a big announcement on business energy support, the result was underwhelming. 
 
There was very little to help companies worried about rising energy costs. While the Chancellor, Rachel Reeves did say that \u201cwe are taking forward our commitment to slash electricity prices for thousands of manufacturing businesses\u201d, the most important news actually came earlier in the week as part of the British Industrial Competitiveness Scheme (BICS)<\/a>, a new framework that\u2019s aiming to bring down electricity costs for eligible manufacturers. <\/p>\n\n\n\n

In this article, we highlight what did (and didn\u2019t) happen in Budget 2025<\/a> in terms of business energy costs, while explaining what the new BICS scheme means for manufacturing businesses. <\/p>\n\n\n\n

What didn\u2019t happen in Budget 2025<\/h2>\n\n\n\n

No cut to VAT<\/h3>\n\n\n\n

There are always pre-budget rumours, but the mooted cut in VAT on energy bills didn\u2019t happen. There had been talk of a reduction on the 20% VAT on non-domestic energy, but in the end the move proved to be too complex to implement and would have likely missed the mark anyway.<\/p>\n\n\n\n

What did happen in Budget 2025<\/h2>\n\n\n\n

Review of new energy levies<\/h3>\n\n\n\n

There was a vague promise to \u201csubject any additional costs, including new levies, to enhanced scrutiny under a new framework to ensure they are affordable, represent value for money and do not impose unnecessary costs on households and businesses.\u201d <\/p>\n\n\n\n

Network Charging Compensation (NCC) Scheme uplift<\/h3>\n\n\n\n

Budget 2025 pointed to the outcome of a recent consultation on the Network Charging Compensation (NCC) Scheme for energy intensive industries (EIIs)<\/a>. Plans have been announced to \u201cincrease the generosity of the British Industry Supercharger from April 2026\u201d, by cutting electricity costs for around 550 energy intensive businesses through an uplift of the NCC Scheme from 60% to 90%. <\/p>\n\n\n\n

Energy Profits Levy (EPL) to be replaced<\/h3>\n\n\n\n

The Energy Profits Levy (aka windfall tax) will continue until 2030 despite rumours that it may be rolled back and will eventually be replaced in 2030 (or\u202fearlier\u202fif the EPL’s price floor trigger is hit) by the permanent Oil and Gas Profits Mechanism (OGPM).  <\/p>\n\n\n\n

5p fuel duty cut staying<\/h3>\n\n\n\n

There\u2019s some good news for businesses that run fleets as the 5p fuel duty cut is staying in place until the end of August 2026. After that, rates will gradually return to March 2022 levels by March 2027. 
 
It was also announced that the planned increase in line with inflation for 2026-27 has been cancelled. <\/p>\n\n\n\n

In case you missed it: Energy brokers are to be regulated by Ofgem<\/h2>\n\n\n\n

Separate from Budget 2025, it was recently announced that Ofgem will start to regulate third-party energy brokers<\/a>. 
 
For years, businesses (especially SMEs) have complained about opaque commission structures and dodgy practices among Third-Party Intermediaries (TPIs). Now, Ofgem will introduce formal regulation, including power to: <\/p>\n\n\n\n