Energy bill cuts for North Yorkshire businesses 'an essential lifeline'
The cap will kick in from October with schools and hospitals also covered
Last updated 21st Sep 2022
Businesses are going to see their wholesale energy costs cut to less than half their expected level through the winter.
The Government made the announcement today and say the cap will kick in from October with schools and hospitals also covered.
Although the scheme is set to last for six months, it will be reviewed halfway though.
Carolyn Frank, development manager at the Federation of Small Businesses in York and North Yorkshire, said: "This really is going to save business closures. Businesses were just cracking under pressure from these severe increases; 300 percent on electricity and 400 percent on gas. This clarity is really welcome and it's really helpful for businesses because they can plan ahead now for winter.
"I think some businesses may fall out of the support that's being offered so those who signed bills between February and April for example. We welcome the announcement also for equality for those off-grid customers on heating oil beacuse that's been a big concern for our members across rural and coastal areas across North Yorkshire.
"Businesses have been in a really difficult place. They've come out of the back of the pandemic where resources were already stretched, they're struggling to access finance, they've taken on a lot of debt during the pandemic and then really the speed from recovery to almost recession has really been a side swipe for them.
"My message would be 'think small first' and really support your local businesses in your communities across York and North Yorkshire because they're going to still need support. This is a lifeline but it's not a solution to the difficult situation that small businesses find themselves in. It's not just about profit for business owners, it's about the services they provide in communities and protecting jobs."
John Senior, Chairman of the South Bay Traders Association in Scarborough, also owns three restaurants in the town. He said: "I think we were all extremely nervous about the way things were going. I know when I did my numbers, we were only just going to survive and we'd actually managed to negotiate a fairly decent deal so for many, many businesses this is an absolutely essential lifeline. I'm extremely relieved it's come through.
"I think most of us weren't going to be able to cope. We were just about marginal, we'd managed to negotiate what we thought they were very good deals, something like 38p a kilowatt unit, which was treble what we were paying before but we could just about survive on that but there was nothing left in it for us, so it was very marginal and those were good rates.
"It would have been extremely difficult for all of us to get through the winter so this is a massive relief to us all. Obviously we'd get through but we'd have to pass the prices on to our consumers, which is something that we don't want to have to do especially with all the other pressures they have to bear so this is just extremely good news for all of us.
"I'm hoping it's going to be enough. I think it depends on what business you're in. A slight cut in VAT would have been helpful, particularly with the inflation issues but this is a bit of a lifeline because the major issues facing most businesses were the energy issues, because you just can't price that into the game. It was just too much, too big a jump to be able to put your prices up, you would basically have to close probably."