The measures, which could slash energy bills by up to 25% for more than 7,000 UK businesses, have been unveiled alongside other plans aimed at boosting growth
More than 7,000 British businesses are set to see their electricity bills slashed by up to 25% from 2027, as the government unveils its bold new Industrial Strategy today. The strategy sets out a ten-year plan to boost investment, create skilled jobs, and make Britain the best place to do business by tackling two of the biggest barriers facing UK industry—high electricity prices and long waits for grid connections.
Business and Trade Secretary Jonathan Reynolds emphasised the government’s commitment to making the UK the best place to invest and do business. “We’ve said from day one Britain is back in business under this government, and the £100 billion of investment we’ve secured in the past year shows our Plan for Change is already delivering for working people,” he said. Reynolds highlighted that the strategy will not only attract billions for new business sites and cutting-edge research but also make industrial electricity prices more competitive.
British manufacturers currently pay some of the highest electricity prices in the developed world, while businesses looking to expand or modernise have faced delays when connecting to the grid. These challenges have long held back growth and made it harder for British firms to compete. Today’s announcement marks a decisive shift, with the government stepping in to support industry and unlock the UK’s economic potential.
Prime Minister Keir Starmer said, “This Industrial Strategy marks a turning point for Britain’s economy and a clear break from the short-termism and sticking plasters of the past. In an era of global economic instability, it delivers the long-term certainty and direction British businesses need to invest, innovate, and create good jobs that put more money in people’s pockets as part of the plan for change.”
From 2027, the new British Industrial Competitiveness Scheme will reduce electricity costs by up to £40 per megawatt hour for over 7,000 electricity-intensive businesses in manufacturing sectors like automotive, aerospace, and chemicals. These firms, which support over 300,000 skilled jobs, will be exempt from paying levies such as the Renewables Obligation, Feed-in Tariffs, and the Capacity Market—helping level the playing field and make them more internationally competitive.
The government is also increasing support for the most energy-intensive firms—like steel, chemicals, and glass—by covering more of the electricity network charges they normally have to pay through the British Industry Supercharger. These businesses currently get a 60% discount on those charges, but from 2026, that will increase to 90%. This means their electricity bills will go down, helping them stay competitive, protect jobs, and invest in the future.
Chancellor of the Exchequer Rachel Reeves added, “The UK has some of the most innovative businesses in the world and our Plan for Change has provided them with the stability they need to grow and for more to be created. Today’s Industrial Strategy builds on that progress with a ten-year plan to slash barriers to investment. It’ll see billions of pounds for investment and cutting-edge tech, ease energy costs, and upskill the nation. It will ensure the industries that make Britain great can thrive. It will boost our economy and create jobs that put more money in people’s pockets.”
These reforms complement the government’s long-term mission for clean power, which is the only way to bring down bills for good by ending the UK’s dependency on volatile fossil fuel markets. To ensure businesses can grow and hire without delay, the government will also deliver a new Connections Accelerator Service to streamline grid access for major investment projects—prioritising those that create high-quality jobs and deliver significant economic benefits.
Energy Secretary Ed Miliband said, “For too long high electricity costs have held back British businesses, as a result of our reliance on gas sold on volatile international markets. As part of our modern industrial strategy, we’re unlocking the potential of British industry by slashing industrial electricity prices in key sectors. We’re also doubling down on our clean power strengths with increased investment in growth industries from offshore wind to nuclear. This will deliver on our clean power mission and Plan for Change to bring down bills for households and businesses for good.”
The Industrial Strategy is the latest step forward in the government’s plans to deliver national renewal. It will include targeted support for the areas of the country and economy that have the greatest potential to grow, while introducing reforms that will make it easier for all businesses to get ahead.
