In this edition of Compliance Corner, we explore the British Industrial Competitiveness Scheme (BICS) and what it could mean for manufacturers facing rising energy costs and increasing pressure to remain competitive. 

Our aim is to break down what’s changing, why it matters, and how businesses can prepare ahead of the upcoming application window. 

🔍 What’s happening? 

The Government has confirmed the design of the British Industrial Competitiveness Scheme (BICS), a key measure within the UK’s Modern Industrial Strategy designed to improve the competitiveness of British manufacturing. 

In simple terms, the scheme aims to reduce electricity costs for eligible manufacturers by removing certain policy-related charges from electricity bills. 

The Government estimates that eligible businesses could see savings of up to 25% on electricity costs, equivalent to around £35-£40 per MWh, with more than 10,000 businesses across Great Britain expected to benefit. 

Businesses that qualify will be exempt from the indirect costs associated with: 

• Renewables Obligation (RO) 

• Feed-in Tariffs (FiT) 

• Capacity Market (CM) 

It is important to note that BICS only applies to these specific policy costs. It does not reduce network charges such as DUoS or TNUoS, does not apply to gas consumption, and does not cover Contracts for Difference (CfD) costs. 

📊 What’s different? 

BICS is often confused with the British Industry Supercharger because both schemes aim to reduce energy costs for energy-intensive industries. 

However, BICS has been designed to support a broader range of manufacturers by introducing lower electricity-intensity thresholds: 

• 0.9% for frontier sectors 

• 2.7% for foundational industries 

By comparison, the British Industry Supercharger uses a significantly higher threshold of 7%, meaning fewer organisations qualify. 

To be eligible for BICS, businesses must satisfy three separate criteria: 

Sector Test 

The business must operate within an eligible sector, confirmed through its SIC code. 

Product Test 

The site must manufacture at least one eligible product, confirmed through an HS code. 

Intensity Test 

The site must meet the required electricity-intensity threshold. 

Eligibility is assessed on a site-by-site basis, with support linked to the proportion of electricity used in eligible manufacturing activities: 

• Less than 25%: No exemption 

• 25%-50%: 50% exemption 

• More than 50%: 100% exemption 

The scheme applies to sites located in England, Scotland and Wales, but not Northern Ireland. 

💡 What this could mean for you 

For qualifying manufacturers, BICS has the potential to significantly reduce electricity costs and improve budget certainty during a period of continued market pressure. 

However, eligibility is determined at site level and depends on meeting specific sector, product and electricity-intensity requirements. Simply operating within an eligible industry may not be enough to qualify. 

As a result, organisations should begin reviewing their sites, electricity consumption profiles and eligibility criteria well ahead of the application window. An early assessment could help identify opportunities and avoid missing available support.

📅 What’s next? 

The next few months will be important for businesses considering an application. 

Businesses that apply during the initial application window will be eligible for support from April 2027 and could receive a one-off backdated payment covering eligible costs from April 2026 onwards. 

Organisations that miss the first application window may need to wait for a future round and may not benefit from any backdated support. 

A Government eligibility checker is also expected to be released in the coming months. 

The Open Take 

BICS represents more than just an energy support scheme. It reflects a wider shift towards strengthening the competitiveness of British industry through targeted intervention. 

For manufacturers, the potential savings are significant, but the key challenge will be understanding eligibility and acting early enough to secure support.

Those that assess their position now and prepare ahead of the application window will be best placed to maximise the benefits available and strengthen their long-term cost resilience.

If you’d like to explore how these developments could impact your organisation, speak to our team. 

This article forms part of our Compliance Corner series, sharing practical insights on procurement, ESG & energy, and regulatory change to support organisations navigating an evolving compliance landscape. 

Sources 

GOV.UK British Industrial Competitiveness Scheme (BICS) consultation response and Hansard written statement (8 July 2026); Department for Business and Trade press release (16 April 2026).