The British Ports Association (BPA) – the membership body representing most UK ports – has called on Ministers to reverse a decision to remove the industry from a Government support scheme designed to provide relief to businesses from high energy prices.
The Energy Bills Discount Scheme (EBDS) is the successor to the Energy Bill Relief Scheme, which provided support to businesses from October 2022.
Some ports now say that energy is a higher cost than wages – traditionally a port’s highest cost base. As inflation shows no sign of abating in the near future, ports are warning that the move to exclude ports from the new scheme could add direct costs to supply chains. It could also destabilise tentative moves towards further port electrification and the supply of electricity to port users.
It is disappointing that Ministers have cut ports out of the new energy support scheme and it is likely that this will add direct cost to supply chains.
Ports’ immediate options for reducing fuel consumption are extremely limited and this decision piles additional cost pressure on the industry at a difficult time. We hope Ministers will reconsider.
The previous energy bill support scheme was welcomed by ports at a time when ports’ primary cost bases – wages and energy – were soaring. Also our ports compete internationally so keeping costs down is good for encouraging trade and inward investment into the country.
Whilst the new EBDS is more modest, our sector is still feeling the strain from high energy costs. This has been exasperated by the Government’s 2022 removal of red diesel tax benefits for landside port operations. The red diesel tax change alone added significant cost to operations without any support for port electrification. Including ports in the EBDS would make the Government’s aim of supporting moves to electrification – where feasible – more realistic.