The UK Government has announced that that thousands of manufacturers are set to receive significant electricity cost relief from April 2027, through the British Industry Competitive Scheme (BICS).

April 2027. Designed as part of the Government’s wider Industrial Strategy, the scheme aims to strengthen the competitiveness of key UK industries by addressing one of their most pressing challenges: high energy costs.

Why BICS is Being Introduced

Energy prices have remained persistently high in recent years, placing considerable strain on UK businesses. This is due to a combination of factors, including the UK’s pricing structure – where electricity costs are closely linked to gas prices – as well as wider geopolitical pressures affecting global energy markets.

In addition, rising non-commodity charges, which fund renewable energy initiatives and infrastructure upgrades to support net zero ambitions, now account for 60% of a typical electricity bill.

For energy-intensive sectors, these costs have impacted investment decisions, productivity and job creation. BICS has therefore been introduced to support industries seen as critical to the UK’s long-term economic resilience and international competitiveness.

What Relief the Scheme Offers

BICS will reduce electricity costs by exempting eligible businesses from several non-commodity charges. Government estimates suggest this could lower electricity prices by approximately £35–£40 per MWh.

The exemptions include:

Renewables Obligation (RO) – supporting low-carbon electricity generation
Feed-in Tariffs (FITs) – incentivising small-scale renewable energy production
Capacity Market (CM) – ensuring security of electricity supply

RO and FIT exemptions are scheduled to begin in April 2027, with CM relief following in October 2027.

Who May Qualify

The scheme targets businesses operating within key manufacturing sectors identified in the Government’s Industrial Strategy – often referred to as “growth sectors”. These include:

Advanced Manufacturing
Clean Energy Industries
Defence
Digital Technology
Life Sciences
Foundational Industries

Eligibility will depend not only on sector classification (via SIC and HS codes) but also on an electricity intensity test. Businesses must demonstrate that electricity costs represent:

More than 0.9% of production value for frontier manufacturing sectors
More than 2.7% for foundational industries

Compared to previous schemes, BICS is broader in scope and expected to support over 10,000 businesses.

Key Timelines

Businesses will likely need to submit eligibility data between October and November 2026, with confirmed participants announced in January 2027. A consultation on the scheme’s final design is currently underway, with legislation expected later in 2026.

How L&C can Support Your Business

With non-commodity costs now making up the majority of commercial electricity bills, the financial impact of BICS could be substantial. However, navigating eligibility criteria and application requirements will be critical to securing the full benefit.

L&C is well placed to guide businesses through this process. With extensive experience supporting clients under existing energy relief schemes, we can help you:

Assess your eligibility early
Calculate and validate electricity intensity thresholds
Prepare and submit accurate applications
Manage ongoing compliance and reporting requirements

Early preparation will be key. By engaging with L&C ahead of the application window, your business can maximise its chances of qualifying and ensure it captures every available saving.

If you believe your organisation could benefit from BICS, now is the time to act. Contact L&C to explore how we can support your application and help reduce your energy costs from 2027 onwards.

British Industrial Competitiveness Scheme (BICS) – Update