The construction industry has welcomed the new Energy Bill Relief Scheme which will cut energy prices for businesses as it fixes wholesale gas and electricity prices for six months from 1 October.
Equivalent support will be given to those that use heating oil or alternatives to gas and further details on this are expected to be announced shortly.
The scheme will be reviewed in three months where a decisions will be made on future support after March 2023, when the scheme is currently set to end.
The Builders Merchant Federation (BMF) has welcomed the announcement from Business Secretary Jacob Rees-Mogg, saying it will help tackle a real concern for the industry and provides a relied to its members who have already had to combat erratic economics.
John Newcomb, CEO of the BMF, said: “Rising energy bills are a very real concern for our industry.
“The BMF and other business groups asked the new government for clear, decisive action to help businesses, large and small, faced with steadily rising energy bills, and that’s what’s happened.
“We are pleased that ministers have listened and acted quickly and massively to help BMF members – especially manufacturers who are large users of energy – to make much-needed building materials and home improvement products.
“We are encouraged at the speed, scale and geographic spread of todays’ package. However, there are associated policies in the medium- to long-term that Whitehall needs to press on with in tandem to help with energy demand and energy security.
“There is an urgent need to address home energy-efficiency in the UK, where a high proportion of homes are rated EPC Band C or below.
“One of our key asks of the government is to commit to a comprehensive, properly-funded national plan of investment in training to boost the number of competent, qualified people equipped to upgrade the energy efficiency of homes and to install low- or zero-carbon solutions.”
Meanwhile, James Talman, CEO of the National Federation of Roofing Contractors (NFRC), said: “This is a welcome move from the government at a time when businesses have faced difficult decisions as a result of rocketing energy prices. For many small firms, having this simple and sizeable discount automatically applied to bills will be a crucial lifeline.
“However, it has to be recognised that many businesses will still be forced to spend more on energy than in previous years. Companies with small margins will still see these eroded by the increased cost of energy. At a time when many SMEs are worried about survival, this may simply be too little, too late for some firms who have struggled for months without relief. The government must now ensure that after the six-month period for which these measures are promised, businesses are not left to bear rising costs alone once again.
“NFRC members have faced spiralling material price increases, combined with added pressures such as labour shortages, over the past 18 months, and energy costs present an immense challenge that can push businesses, particularly SMEs, over the edge. Clearly it is essential that businesses are given certainty, and should know what to expect for their energy costs for longer than six months. As soon as possible, the government should set out plans for after the six-month period. Small businesses will not survive otherwise.
“The construction supply chain must also play its part, by ensuring all sub-contractors and suppliers are paid promptly and in full, and by ceasing the use of retentions in new contracts now, not waiting until 2025. Our members can’t invest in skills and competency essential to our sector’s prosperity on top of additional cash flow issues.”
>>Read more about how inflation has impacted the industry here.
