“Energy-intensive industries need to make some investments to be able to adapt. The investments companies will make depend on how they respond to this initiative.”
Factories could switch to diesel fuel, reduce their output or start using combined heat and power units to provide heat and electricity for less energy-intensive processes such as chemicals, paper and food and beverage production.
UK ministers have been warned that energy-intensive industries are at risk from rising energy prices by PwC in November 2021.
The Treasury commissioned a report as part of “Project Shrine” and was told that industries including chemical and fertilizer manufacturers are particularly at risk from the energy crisis.
Two-thirds of businesses were facing a jump in their bills over the next three months, with a third of these firms facing increases of more than 30%, the CBI said.
Freezing business rates in 2023 will spare companies from double-digit growth next year. Interest rates are usually linked to September’s rise in the consumer price index (CPI), which is expected to rise well above the 10.1% rate recorded in July. He also urged the government to give companies and the self-employed more time to pay their taxes and provide easier access to pandemic-style loans to shore up their finances.
The CBI poll of nearly 600 businesses also found that while a third of businesses were trying to avoid passing on higher costs to customers, many had halted investment to cope with price rises.
“While helping struggling consumers remains our number one priority, we cannot afford to lose sight of the fact that many viable businesses are under pressure and could easily go into distress without action,” said Matthew Fell, Chief Policy Director of the CBI.
“Companies are not asking for a handout. But they need the autumn to be the time for the government to tackle the energy cost crisis. Decisive action now will give businesses room for cash flow and prevent a short-term crisis from becoming a longer-term one.” crisis.”
