British Industrial Competitiveness Scheme: What BICS Means for UK Manufacturers

The government has published its responses to both consultations on the British Industrial Competitiveness Scheme (BICS), confirming the scheme’s eligibility framework, delivery approach and implementation timetable. BICS is intended to help eligible manufacturing businesses manage certain electricity policy costs included in their bills. 

For manufacturers with significant electricity use, the scheme may be worth reviewing. However, eligibility will depend on the final legislative framework, the type of manufacturing activity carried out, the products made, and how electricity is used at site level. 

The headline criteria are only part of the picture. For many businesses, the detail will sit at site level: what is being manufactured, how electricity is used, and how meters and boundaries are arranged. 

Our role is to help businesses understand what the scheme may mean in practice, and how it could apply to specific sites, meters, activities and existing energy arrangements.

What is the British Industrial Competitiveness Scheme?

The British Industrial Competitiveness Scheme has been designed to reduce electricity costs for selected manufacturing businesses in frontier industries and foundational manufacturing sectors that support them. The government has confirmed that support will be targeted at manufacturing frontier industries within the Industrial Strategy growth sectors, and qualifying foundational manufacturing industries that provide key inputs to those frontier industries.

The scheme focuses on three electricity policy cost areas:

  • Renewables Obligation (RO)
  • Feed-in Tariffs (FiT)
  • Capacity Market (CM) charges 

The scheme is expected to apply in Great Britain, covering England, Wales and Scotland, with separate arrangements expected to be developed for Northern Ireland.

Government material indicates that more than 10,000 businesses could benefit from the scheme, with electricity cost reductions of up to approximately GBP40/MWh where eligibility criteria are met. Actual savings will depend on site-level eligibility, electricity consumption, metering arrangements and the share of electricity used for qualifying manufacturing activity.

Why This Matters

Electricity costs remain a significant issue for many UK manufacturers. The government has identified high industrial electricity prices as a competitiveness challenge, particularly for businesses operating in internationally exposed manufacturing sectors. 

The scheme is intended to support eligible manufacturing activity within the Industrial Strategy growth sectors, alongside foundational industries that provide important inputs to those sectors. 

That means some organisations that have not previously qualified for certain energy cost relief schemes may wish to review whether this new route is relevant to them. This should be treated as an assessment exercise rather than an assumption of eligibility.

Who May Be in Scope?

The Government has now confirmed that businesses must satisfy both the sector and product requirements of the scheme. In practice, this means a business must operate within an eligible manufacturing sector identified through a qualifying SIC code and manufacture at least one eligible product identified through a qualifying HS code. Having only one of these criteria will not, by itself, be sufficient to qualify.

At a high level, BICS eligibility is determined by:

  • whether the business operates in an eligible sector (identified through SIC4 codes)
  • whether it manufactures an eligible product (identified through HS6 codes*)
  • whether electricity intensity and site-level usage of electricity qualify

The level of exemption is also expected to depend on the proportion of electricity used at a site for eligible manufacturing activity.

The sector lists themselves have been shaped by an electricity-intensity test, based on sector-level electricity intensity, rather than individual business assessment. This makes site-level evidence important; a business may operate in a potentially relevant sector and manufacture a potentially relevant product, but the position still needs to be tested against its actual products, processes, meters and electricity allocation.

Government responses have reaffirmed that support will ultimately be determined at site level. Businesses may need to demonstrate how much electricity is used specifically for qualifying manufacturing activity. This is particularly relevant for organisations operating multi-use sites, shared services, landlord-supplied electricity arrangements, private wire connections or mixed manufacturing and non-manufacturing operations.

*Businesses do not necessarily need to have used HS codes previously, for example through exporting. The relevant point is whether they manufacture a product associated with an eligible HS6 code.

Timing and Current Status

The government currently expects Renewables Obligation and Feed-in Tariff exemptions to apply from April 2027, with Capacity Market exemptions applying from October 2027. 

The first application window has now been confirmed. Businesses will be able to apply between 1 October 2026 and 30 November 2026, with successful applicants receiving support from scheme commencement in 2027. Businesses intending to apply should therefore begin reviewing eligibility criteria and supporting data requirements before the application period opens.

The Government has also announced that an online BICS eligibility checker will be made available. This is intended to allow businesses to input key information and receive an initial indication of whether they are likely to fall within scope before submitting a formal application.

The second consultation response also indicates that businesses may need to provide electricity consumption data before applying, with further detail on evidence requirements expected in formal guidance.

This means businesses that may be in scope should consider what information they may need before the window opens, rather than waiting until exemptions are due to appear on bills.

Although key aspects of eligibility and delivery have now been confirmed through Government responses, implementation remains dependent on the completion of legislative and regulatory changes. The Government has indicated that legislation will be introduced during Autumn 2026, with support scheduled to begin from April 2027 for eligible businesses.

Additional Government Support Before Scheme Launch

During consultation, stakeholders highlighted concerns that support would not become operational quickly enough to address current electricity cost pressures. In response, the Government has confirmed that eligible businesses will receive an additional payment in 2027 covering the 2026-27 period.

This payment is intended to reflect the support eligible businesses would have received had BICS been capable of being implemented earlier. Businesses should review the final guidance once published to understand how the additional payment will be administered and what evidence may be required.

How BICS Fits into Wider Electricity Cost Reform

BICS should also be viewed in the wider context of electricity cost reform. Recent debate around decoupling gas and electricity prices has focused mainly on wholesale power costs – in particular, the way gas-fired generation can influence the market price of electricity under marginal pricing. 

The key difference is that decoupling is about how wholesale electricity prices are set, whereas BICS relates to selected policy costs within electricity bills, including the indirect costs linked to the Renewables Obligation, Feed-in Tariffs and Capacity Market. Whether those costs are affected for an individual business will depend on the scheme criteria and how they apply at site level. 

Together, these developments show that electricity costs are being addressed through more than one route. For businesses, the practical question is not simply whether electricity prices may fall, but which parts of their bill are changing, which reforms may apply to them, and what evidence is needed to make informed decisions.

Interaction with Other Schemes

BICS should also be considered alongside any existing energy, carbon or cost relief arrangements.

The government has stated that businesses already receiving, or eligible for, the British Industry Supercharger cannot also receive the same exemptions through BICS, as the same support cannot be provided twice. 

Government has also reaffirmed that businesses cannot receive duplicate support for the same electricity policy costs through both BICS and the British Industry Supercharger. Businesses already benefiting from related schemes should therefore review how support mechanisms interact before making assumptions about entitlement.

For organisations with Climate Change Agreements (‘CCA’) or other energy compliance arrangements, the main issue is likely to be consistency: using reliable data, clear site boundaries and appropriate evidence so that any assessment is based on a defensible position.

A Practical Next Step

Businesses that may be in scope should consider what information they need before the application window opens, rather than waiting until exemptions are due to appear on bills.

A practical review should consider:

  • SIC classifications and whether the business operates in an eligible manufacturing sector
  • products manufactured and how they align to eligible HS6 codes
  • site boundaries and whether activities are mixed or clearly separable
  • metering arrangements, including shared supplies, landlord structures and private wire positions
  • at least six months of electricity consumption data or other consumption evidence required by guidance
  • existing participation in energy relief schemes, including the British Industry Supercharger, CCA or other relevant arrangements
  • contractual arrangements that may affect the pass-through of policy cost exemptions

Completing this review before the application window opens should reduce the risk of delays during the formal assessment process.

How EIC Can Help

As an independent consultancy, our role is to provide clear, unbiased advice so businesses can make informed decisions. For BICS specifically, that means helping organisations understand whether the scheme may apply, what evidence would be needed and whether the work involved is proportionate.

Speak to the EIC Team today to discuss an initial review. 

With a century of combined experience in carbon and energy strategy, EIC Partnership is here to help you manage today and plan for tomorrow.

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