The government is expected to announce on Wednesday that all businesses in Britain and Northern Ireland will receive a discount on their electricity bills, funded by taxpayer subsidies.

Industry sources have been told a one-size-fits-all scheme is expected to apply to all sectors of the economy when Business Secretary Jacob Rees-Mogg unveils details of the scheme at 9am.

The government is set to cut costs by subsidizing wholesale energy prices for business users, meaning the level of discount will depend on what companies are already paying.

The move will effectively cap the unit cost of electricity and gas charged to businesses, with government borrowing to fund the bill for the difference, which is expected to be in the tens of billions of pounds.

The scheme will run for six months from October 1, with a review three months later to decide whether it should be extended or whether individual sectors require more targeted support.

Businesses have been left waiting for details on what government support they can count on before the Queen’s death, with no details in Prime Minister Liz Truss’s initial statement on September 8.

While consumers have been relatively protected from soaring prices by domestic price caps, and now a government-set maximum price cap that will limit the average bill to £2,500 a year, business users have faced uncertainty.

There is no price cap for commercial users, and companies have faced annual increases in electricity bills of between 100% and 800%, prompting concerns of mass closures.

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The next few weeks are crucial for many businesses, as the renewal date for many annual energy deals is October 1, the same date when rates for the fourth quarter of the year are due.

Business sources told Sky News they had been told a comprehensive plan was expected, which would effectively set a maximum unit price for gas and electricity and apply to all business energy users for at least six months.

Speaking in New York, Ms Truss said on Tuesday: “We know that businesses are very concerned about the level of their electricity bills, so we are introducing a scheme for businesses, which will be equivalent to the scheme for households, to make sure that businesses can make it through the winter We’ll review it in six months.

“We will make sure that the most vulnerable businesses, such as pubs, such as shops, continue to be supported after this.

“We will be announcing the scheme on Wednesday, but I can say that the scheme will be in place from October 1 to make sure businesses have that security over the winter.”

Supporting businesses is much more complex than protecting households.

While domestic users typically purchase energy at fixed or floating rates regulated by Ofcom, business users have a variety of ways to access the market, including large volumes directly on the wholesale market.

With uncertainty over medium-term wholesale gas and electricity prices, public support for both households and businesses could reach more than £150 billion.

Ms Truss said she expected the final bill to be lower as negotiations with energy companies help lower the bill for taxpayers.

https://news.sky.com/story/businesses-to-receive-discounts-on-energy-bills-government-expected-to-announce-12702265

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