These regulations will provide further relief against network charging costs for companies in energy intensive industry sectors.

This will reduce the cost of electricity for companies in sectors such as steel, brick, tile, construction product, oil, glass or paper manufacturing.

The Energy-Intensive Industry Electricity Support Payments and Levy Regulations 2024 came into force on 21 March 2024.

This legislation applies across Great Britain.

What has changed?

An Energy Intensive Industry (EII) electricity support scheme is established. This scheme will provide EIIs relief against network charging costs. The regulations also establish a levy on electricity suppliers, which will finance the cost of the support provided and finance the administrator (Elexon Ltd) of the scheme.

The legislation aims to avoid carbon leakage and competitive disadvantages for GB EIIs, which may arise when competitors overseas face less stringent environmental requirements or subsidies.

Network charges include a range of charges on electricity consumers, including to operate the contracts for difference (CfD), renewables obligation, capacity market and feed-in tariff initiatives.

Electricity support payments

Electricity support payments compensate EIIs for the network charging costs associated with their electricity use. These payments will be made monthly.

Qualifying EIIs may register for and apply for support payments on a quarterly basis. The regulations also state the information required for these applications.

EIIs may request information for these applications from electricity suppliers.

EII levy

The costs of electricity support payments and the operation of the scheme administrator will be reclaimed from electricity suppliers.

The administrator will issue notices stating the levy required within 10 days before the start of each month. Electricity suppliers must then pay within five working days after the notice was issued.

Energy Intensive Industries (EIIs)

The Schedule to the Electricity Supplier Obligations (Amendment & Excluded Electricity) Regulations 2015, as amended lists EIIs, which include:

• quarrying;
• manufacture of bricks, tiles and construction products;
• manufacturing iron, steel, ferro-alloys, aluminium, lead, zinc and tin and various associated products;
• manufacturing electronic components;
• cold drawing wire;
• oil refining;
• manufacture of paper and paperboard;
• manufacture of household and sanitary goods and of toilet requisites;
• producing flat, hollow and fibre glass; and
• producing organic chemicals, inorganic chemicals and plastics.

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