UK Unveils Industrial Strategy to Cut Energy Bills and Boost Growth

The UK government will unveil a new industrial strategy aimed at slashing energy bills for more than 7,000 electricity-intensive businesses by up to 25% starting in 2027. The initiative, part of the 2025–2035 economic growth plan, responds to industry concerns about high energy costs stifling competitiveness and expansion.

With economic growth a top priority, officials aim to address what business groups have called a “critical barrier” to productivity. Industry body Make UK and others have long urged the government to remove climate-related levies that disproportionately impact manufacturers. Under the new plan, firms will be exempt from charges such as the Renewables Obligation to boost global competitiveness.

The move comes as global rivals, including the U.S. and EU, ramp up efforts to support key industries amid shifting trade dynamics driven by tariffs and supply chain reconfigurations. Britain’s updated Industrial Strategy will also launch five focused sector plans in areas like advanced manufacturing, clean energy, and creative industries, emphasizing national strengths in defense and financial services.

Business Secretary Jonathan Reynolds emphasized that energy costs and workforce skills have been the most pressing concerns for British companies. The strategy also expands the British Business Bank’s capacity to invest in small businesses and commits an additional £1.2 billion annually to skills development by 2028–29.

The plan will also streamline planning procedures, boost R&D investment, and reduce regulatory burdens. Funding for energy relief will come through reforms to the energy system, not increased household taxes or bills. Final eligibility criteria will follow public consultation. Business groups including the Confederation of British Industry welcomed the plan as a clear step toward long-term economic stability and competitiveness.