21 September 2026
High electricity costs continue to be a major challenge for UK manufacturers, and the situation is likely to worsen amid ongoing regional tensions in the Middle East leading to rising energy costs. In response, the Government has introduced the British Industrial Competitiveness Scheme (BICS), a new initiative designed to reduce electricity costs for eligible manufacturers and strengthen the UK’s industrial competitiveness.
Applications will open on 1 October 2026, with successful businesses expected to benefit from reduced electricity costs from 2027 onwards, as well as receiving a backdated payment covering 2026. The scheme aims to support manufacturers operating in key growth sectors and foundational industries by exempting them from indirect electricity costs.
What is the British Industrial Competitiveness Scheme?
The British Industrial Competitiveness Scheme is a government programme intended to reduce electricity costs for eligible manufacturing businesses.
Under the scheme, qualifying companies may receive exemptions from the indirect costs associated with:
- Renewables Obligation (RO)
- Feed-in Tariffs (FiT)
- Capacity Market charges
The Government has indicated that the scheme could reduce electricity costs by up to £40 per megawatt hour for eligible businesses, helping UK manufacturers to remain competitive.
Who Can Apply for BICS?
To qualify for BICS, businesses will generally need to:
- Be registered with Companies House.
- Operate in an eligible sector identified through Standard Industrial Classification (SIC) codes.
- Manufacture eligible products identified through Harmonised System (HS) codes.
- Consume at least 33 MWH of electricity at each qualifying manufacturing facility
The scheme focuses on businesses operating within the Government’s priority industrial sectors and supporting manufacturing industries that form critical parts of UK supply chains.
A full list of eligible sectors and products is available at https://www.gov.uk/government/publications/eligibility-for-the-british-industrial-competitiveness-scheme
Key industries which are covered include, but are not limited to:
| Automotive and EV supply chain | Electronics and semi-conductors |
| Aerospace | Life sciences |
| Battery manufacturing | Defence |
| Renewable energy supply chains | Advanced materials |
| Chemicals | Metal casting, forging and machining |
How Much Could a Business Save?
The exact benefit will vary depending on electricity consumption, manufacturing activity and eligibility criteria.
Government guidance suggests that eligible businesses could receive savings worth up to approximately £35 to £40 per megawatt hour of electricity consumption.
For electricity-intensive manufacturers, this could represent a significant reduction in annual operating costs and improve competitiveness when bidding for new work.
BICS vs Energy Intensive Industries (EII) Relief
Many manufacturers are already familiar with the Energy Intensive Industries (EII) support package, also known as the British Industry Supercharger.
A key consideration is that businesses are generally not expected to receive both EII relief and BICS relief on the same electricity costs. The schemes are designed to avoid double funding of policy cost exemptions.
While EII relief remains focused on the most electricity-intensive businesses, BICS is intended to extend support to a much broader group of manufacturers. Businesses that may not qualify for EII could potentially benefit from BICS instead.
Given the potential interaction between the two schemes, businesses should carefully assess which route offers the greatest benefit.
Why BICS Matters for UK Manufacturing
The introduction of BICS forms part of a wider effort to improve the competitiveness of UK industry.
Electricity prices have been cited as a competitive disadvantage for UK manufacturers compared with international competitors. Reducing policy-related energy costs can help businesses to:
- Improve profitability
- Invest in production capacity
- Support business growth
- Enhance competitiveness in domestic and export markets
- Strengthen UK manufacturing supply chains
The scheme may be particularly relevant to manufacturers operating in sectors such as automotive, aerospace, advanced materials, clean technologies, renewable energy, electronics and other strategic industrial sectors.
Preparing for the BICS Application Process
Applications for year one (and the 2026 payment) open on 1 October 2026 and close on 30 November 2026. Businesses considering an application should begin preparing now by:
- Reviewing their SIC codes and business activities and updating Companies House SIC codes if applicable.
- Mapping their manufactured products against relevant HS classifications.
- Gathering electricity consumption data for the last twelve months for each manufacturing site.
Early preparation may help businesses maximise the value available under the scheme and avoid missing out on phase 1 payments.
How Clive Owen Can Help
The BICS eligibility requirements involve both technical and financial considerations. Determining eligibility, understanding interactions with existing relief schemes and quantifying potential savings may require specialist support.
At Clive Owen, our grants advisory specialists work with manufacturing businesses across the UK to identify funding opportunities, assess eligibility criteria and understand the financial implications of government support schemes.
Whether you are exploring BICS for the first time or comparing it with existing EII support, we can help you evaluate the opportunity and support throughout the application process.
Get in touch with a member of the team here
