Business leaders are warning that the UK’s industrial strategy could falter due to crippling energy costs. Ministers are under pressure to provide a comprehensive solution to alleviate these high expenses, which have left manufacturers paying 46% more than the global average.The government is considering an expansion of the “British Industry Supercharger” scheme to offer relief, but concerns remain that this may not be enough. The CBI emphasizes that success hinges on tackling the UK’s high energy costs. Furthermore, industrial strategy will need to address issues like costs that are four times higher than in the U.S., as highlighted by Make UK. News Directory 3 will continue to follow this story. Discover what’s next for the upcoming spending review!
UK Industrial Strategy Faces Hurdles Over high Energy Costs
Updated june 1,2025
British businesses are sounding the alarm: Prime Minister Keir Starmer’s upcoming industrial strategy risks failure if it doesn’t comprehensively address the nation’s soaring energy costs. The strategy, slated for release this month, aims to boost key sectors, but high energy prices could undermine it’s effectiveness.
government officials acknowledge the need to tackle high energy costs, which manufacturers say are 46% higher than the global average.Though, some business groups worry the government’s response will be too narrow, focusing only on the most energy-intensive industries.
Ministers are reportedly considering expanding the “British Industry Supercharger” scheme, initially launched by Rishi Sunak’s government in April 2024. The scheme provided energy bill relief to 370 energy-intensive companies.
Rain Newton-Smith, director-general of the CBI employers’ federation, emphasized the critical link between energy costs and the success of the industrial strategy. “Unless the industrial strategy delivers a solution to the UK’s high energy costs for industry, it will have failed,” Newton-Smith said.
Make UK, a manufacturing lobby group, reports that industrial energy costs in Britain are four times higher than in the U.S. Stephen Phipson, Make UK’s chief executive, warned of risks to national security if high energy costs aren’t addressed.
starmer’s industrial strategy prioritizes eight sectors: advanced manufacturing, clean energy, creative industries, defence, digital technologies, financial services, life sciences, and professional services.
Industry officials anticipate a more generous approach to the British Industry Supercharger, potentially increasing network charge cuts for eligible companies to levels closer to those offered in France and germany.
Alan Johnson, senior vice president at Nissan, noted the Sunderland manufacturing plant faces the highest energy costs among all Nissan plants globally. The industrial strategy is expected around June 11, coinciding with the Treasury’s spending review. The Department for Business and Trade declined comment.
What’s next
The government is under pressure to deliver a thorough industrial strategy that tackles high energy costs, ensuring the UK remains competitive in key sectors.The upcoming spending review will provide further insight into the government’s plans.
