A major shift in industrial energy costs is coming.
The question is whether your business stands to benefit.
Over the next 18 months, the government will introduce new support measures designed to reduce electricity costs for thousands of UK manufacturers and energy-intensive businesses.
From enhanced Energy Intensive Industry (EII) relief to the introduction of the British Industrial Competitiveness Scheme (BICS), the changes could be worth tens of thousands of pounds a year for some organisations.
For qualifying organisations, the opportunity could be significant. The challenge is understanding whether your business is one of them.
What’s changing?
The government has confirmed the introduction of the British Industrial Competitiveness Scheme (BICS), which is expected to extend support to thousands more manufacturers from April 2027. Eligible businesses will receive exemptions from policy costs including:
- Renewables Obligation (RO)
- Feed-in Tariff (FiT)
Capacity Market (CM) relief is expected to follow from October 2027.
Government estimates suggest qualifying businesses could see electricity costs reduced by up to £40/MWh, representing a significant benefit for electricity-intensive operations.
Earlier in 2026, we saw the existing Energy Intensive Industries Network Charging Compensation Scheme increased its reductions from 60% to 90%.
This means eligible businesses (the largest, most energy-intensive sites) receive significantly greater support against electricity network charges, including transmission, distribution and balancing costs.
Could your business qualify?
Eligibility for BICS is not based on energy consumption alone.
Businesses must operate within eligible sectors, manufacture qualifying products and meet the required electricity intensity criteria.
The assessment uses both SIC codes and product classifications to determine eligibility.
Eligibility goes right down to site level. Parts of your business could qualify, and others may not.
Many organisations may assume they do not qualify at all and never investigate further.
Others may discover they are eligible for support that could deliver meaningful savings for years to come.
If you already receive EII support, you will not be eligible for under the BICS scheme. If you stop meeting the EII eligibility criteria, you may be able to requalify under BICS.
Why does it matter now?
Applications for BICS will open on 1 October 2026 and close on 30 November 2026.
While the scheme is scheduled to run until 2035, the government has not identified future application windows so it is really important that you apply during the October-November 2026 window.
The businesses that start reviewing their position now will be best placed to understand the opportunity and make informed decisions.
So important question: who pays?
Sadly, support schemes do not remove costs from the market.
They redistribute them.
Not every business will qualify for support. That’s why understanding your position and potential savings is so important.
Some organisations will see electricity costs reduce, while others may experience increasing exposure to policy and network costs over time.
That doesn’t make the changes good or bad. It simply makes understanding them more important.
What next?
At Indigo Swan, we believe good energy management starts with understanding.
These changes create opportunities for some businesses and challenges for others. The key is knowing which side of that equation you sit on.
Whether you qualify for BICS support or not, understanding the evolving cost landscape will help you make better energy decisions and avoid surprises further down the line.
If you’d like to understand how BICS, EII changes or wider policy cost reforms could affect your business, we’re here to help.
Let’s Change Energy Together.
Want to check for yourself? Take a look at the UK Governments eligibility checker:
https://check-eligibility-for-bics.service.gov.uk/check
