What Manufacturers Need to Know About the British Industrial Competitiveness Scheme (BICS)
- 13 hours ago
- 3 min read
The UK manufacturing sector has faced years of pressure from high electricity prices, with many businesses paying significantly more for power than competitors across Europe. The new British Industrial Competitiveness Scheme (BICS) is designed to address that challenge by reducing energy policy costs for eligible manufacturers.
For energy-intensive manufacturers, this could become one of the most important cost-saving opportunities in years.
According to the UK Government, BICS will exempt eligible businesses from paying the indirect costs of the Renewables Obligation (RO), Feed-in Tariffs (FIT), and Capacity Market (CM) schemes. The intention is to bring industrial electricity costs closer to those seen in competing European economies.
It is expected that the government will stagger the implementation of BICS with the relief on RO and FiT applying from April 2027 and relief on CM from October 2027.
What is the British Industrial Competitiveness Scheme?
BICS forms part of the UK’s wider Industrial Strategy and is aimed at supporting:
Manufacturing businesses operating in high-growth strategic sectors
Foundational industries supplying those sectors
Electricity-intensive manufacturers facing international competitive pressure
The scheme is expected to reduce electricity costs by as much as 25% for qualifying businesses.
Unlike broader energy support schemes, BICS is specifically targeted at manufacturing competitiveness and supply chain resilience.
Which Manufacturers Could Be Eligible?
The Government consultation sets out three main eligibility criteria:
1. Your business must operate in an eligible sector
BICS is focused on manufacturing businesses within the Industrial Strategy’s “IS-8” growth sectors, including areas such as:
Advanced manufacturing
Automotive
Aerospace
Clean energy supply chains
Chemicals
Digital and technology manufacturing
Life sciences manufacturing
The scheme may also include “foundational industries” that provide critical inputs into these sectors. Eligibility is expected to be determined using SIC codes.
2. You must carry out manufacturing activity
The scheme is designed for manufacturers rather than service-only businesses.
That means businesses involved in fabrication, processing, production, assembly, or industrial manufacturing operations are more likely to qualify than purely commercial or administrative operations.
3. Your business must meet an electricity intensity threshold
Electricity intensity will be a major factor.
Although the final threshold is still being confirmed, the Government has indicated that businesses will need to demonstrate that electricity costs represent a meaningful proportion of operational expenditure.
Importantly, the threshold is expected to be lower than the existing British Industry Supercharger scheme, potentially opening support to a much wider range of manufacturers.
How Does BICS Compare to the British Industry Supercharger?
Some manufacturers may already receive support through the British Industry Supercharger (BIS).
However, businesses cannot claim support from both schemes simultaneously for the same exemptions. The Government has stated that companies eligible for both are likely to benefit more from the existing Supercharger scheme due to its higher level of support.
For manufacturers outside traditional Energy Intensive Industry (EII) sectors, BICS may provide access to relief that was previously unavailable.
Why An Energy Strategy Still Matters
While BICS could reduce policy-related electricity costs, wholesale market exposure remains a major factor for manufacturers.
That means procurement strategy, demand management, onsite generation, storage, and operational efficiency will continue to play a critical role in competitiveness.
Manufacturers that combine BICS eligibility with a proactive energy strategy are likely to gain the greatest long-term advantage.
For many businesses, now is the right time to assess both eligibility and wider energy optimisation opportunities before the scheme becomes operational.
How Professional Energy People Can Help
With eligibility criteria, electricity intensity calculations, and policy cost exposure all likely to play a role in the British Industrial Competitiveness Scheme (BICS), manufacturers should begin preparing before the scheme is formally implemented.
Our experienced energy procurement specialists can help you assess potential eligibility, analyse electricity consumption data, benchmark current costs, and identify opportunities to strengthen your position.
Get in touch for more information and support.
0330 0022180
For the latest updates on the BICS Scheme visit https://www.gov.uk/government/consultations/british-industrial-competitiveness-scheme-consultation-on-scheme-eligibility-and-approach
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