As the government announces the Energy Bill Relief Scheme, the majority of the industry will cease to receive aid on 31st April.
Ever since the beginning of the energy crisis brought on by the ongoing conflict in Ukraine, venue owners across the Midlands, North, and Scotland have been struggling to afford the massive spike in energy costs. Some stability was provided by the Energy Bills Discount Scheme (EBDS) which started on 1st October 2022 and ends on 31st March 2023.
This will be replaced by the similar- sounding Energy Bill Relief Scheme (EBRS) due to run for a full year from 1st April 2023 to 31st March 2024, but the government will be cutting its overall support by two- thirds which could see a big jump in prices for many venues and suppliers.
Chief Executive of the Meetings Industry Association, Kerrin MacPhie, explains the importance of the initial scheme: “The announcement that the rate of energy bill support will be reduced from 1st April 2023 provides yet another blow for the sector, which has started the year facing fresh uncertainty once more.
“For many, the support package offered by government has served as their organisation’s life support amid a series of events impacting the sector’s performance. Current energy costs are simply unsustainable, and for a sector that is already experiencing a decrease in demand, merely passing on these costs to counteract them simply isn’t achievable. This will have a devastating effect on operators, many of whose hard-earnt financial reserves have already been depleted.”
The current scheme costs the government £18 billion while the new one will only be around £5.5 billion. The current scheme caps the price of energy, which means the maximum price businesses pay now is £211 per megawatt hour (MWh) or 21.1p per kilowatt hour (KWh) for electricity and £75 per MWh or 7.5p per KWh for gas. Without the government support they would be paying around three times more for electricity and more than double for gas.
While the new EBRS policy might seem like the government making the best of a bad situation, it’s important to note that the majority of event industry businesses and venues do not qualify for support from the scheme, as the government intends it to focus on “energy and trade intensive” businesses. This sad revelation comes as the newest in a long series of instances of the government overlooking the events industry for relief packages and minimising its importance to the UK economy.
However, there are some venues such as historical buildings and those which operate as charities may be eligible for support under the new scheme, as Kerrin states: “Under the government’s new Energy Bill Relief Scheme, a higher level of support will be provided to businesses deemed ‘energy and trade intensive’ based on the Standardised Classification Code (SIC) system. Organisations such as historical sites and buildings and similar visitor attractions who host business meetings and events will be eligible for the larger support package based on their SIC. This once again raises the need for organisations within the sector to classify themselves under one consistent code, whereby the sector can be recognised in its own right and not simply unconsidered from government support packages.”