Richard Hunt

Richard Hunt

Head of Customer & Lending, CAF Bank

Charities Aid Foundation

What does the new energy scheme mean for charities?


What has the Government announced?

The Government has announced a new Energy Bill Discount Scheme for businesses and charities. This will run for 12 months from 1 April 2023 to 31 March 2024.

Under the new scheme, organisations with a contract with a licensed energy supplier will receive a unit discount of up to £6.97/MWh applied to their gas bill and a unit discount of up to £19.61/MWh applied to their electricity bill.

This will be subject to a wholesale price threshold of £107/MWh for gas and £302/MWh for electricity, which is set according to the support provided for households. Organisations with energy costs below this level will not receive support.

The existing Energy Bill Relief Scheme will run until 31 March 2023, which provides a discount on wholesale prices for businesses and charities.

What does our organisation need to do?

Charities do not need to apply for the discount since energy suppliers will automatically apply reductions to bills. Ask your supplier for more information if you think the subsidy is not being applied correctly. 

All Government support for energy costs is expected to end in March 2024. It is therefore sensible for organisations to consider how they can improve their energy efficiency and move towards more renewable energy sources over the next year. 

Will our bills be higher? 

Depending on wholesale energy prices and usage, many organisations are likely to have higher bills under this new scheme. 

The Government has provided the examples below:


Energy Bill Discount Scheme

Energy Bill Relief Scheme

From 1 April 2023 to 31 March 2024

Until 31 March 2023

A typical pub uses 16 MWh of gas and 4 MWh of electricity per month. Under the new scheme, it could receive up to £2,280 of taxpayer funded support in the 2023/24 financial year, or £190 a month.

A typical pub uses 16 MWh of gas and 4 MWh of electricity per month. Under the existing scheme, it could receive a discount of £3,100 per month.

It should be noted that these examples are based on discounts from wholesale energy prices, which were higher in summer last year when the existing scheme was announced.   

Is there any additional support available?

Sectors that the Government has designated as ‘Energy and Trade Intensive Industries’ (ETIIs) will receive a higher discount. These more energy intensive industries will receive a unit discount of up to £40 per MWh automatically applied to their gas bill with a price threshold of £99 per MWh. The unit discount applied to their electricity bill is up to £89 per MWh, with a price threshold of £185 per MWh.

In addition to manufacturing, the following areas have been designated as energy-intensive: 
  • Library and archive activities 
  • Museum activities 
  • Operation of historical sites and buildings and similar visitor attractions 
  • Botanical and zoological gardens and nature reserve activities

Charities operating in these areas can apply to see if they qualify for additional support. Further details on how to apply will be published in due course.

How can CAF support my charity?

Find more guidance and advice within our Cost-of-Living Resource Hub, including actionable ways to save energy at your charity’s property from Antonia Swinson, Chief Executive of the Ethical Property Foundation.