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Jacob Rees Mogg: Galvanises businesses with action on energy

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Westminster unveils energy support for businesses

NON WEDNESDAY, September 21, the UK Government announced new support for households, businesses and public sector organisations facing rising energy bills in Great Britain and Northern Ireland.
Through a new government Energy Bill Relief Scheme, the government will provide a discount on wholesale gas and electricity prices for all non-domestic customers (including all UK businesses, the voluntary sector like charities and the public sector such as schools and hospitals) whose current gas and electricity prices have been significantly inflated in light of global energy prices.


The support will be equivalent to the Energy Price Guarantee put in place for households.


It will apply to fixed contracts agreed on or after April 1, 2022, and to deemed variable and flexible tariffs and contracts.


The Price Guarantee will apply to energy usage from 1 October 2022 to 31 March 2023, running for an initial six-month period for all non-domestic energy users.


The savings will be first seen in October bills, which are typically received in November.


As with the Energy Price Guarantee for households, customers do not need to take action or apply to the scheme to access the support.


Support (in the form of a p/kWh discount) will automatically be applied to bills.

RISK OF BUSINESSES MISSING OUT

The price reduction level for each business will vary depending on their contract type and circumstances.


Non-domestic customers on existing fixed-price contracts will be eligible for support as long as the contract was agreed on or after April 1, 2022.


Provided that the wholesale element of the price the customer is paying is above the Government Supported Price, per unit energy costs will automatically be reduced by the relevant p/kWh for the duration of the Scheme.


Customers entering new fixed price contracts after October 1 will receive support on the same basis
those on default, deemed, or variable tariffs will receive a per-unit discount on energy costs, up to a maximum of the difference between the Supported Price and the average expected wholesale price over the period of the Scheme.


Non-domestic customers on default or variable tariffs will therefore pay reduced bills, but these will still change over time and may still be subject to price increases.


The government is working with suppliers to ensure all their customers in England, Scotland and Wales are allowed to switch to a fixed contract/tariff for the duration of the scheme if they wish, underpinned by the government’s Energy Bill Relief Scheme support for businesses on flexible purchase contracts, typically some of the largest energy-using businesses.


The government will provide equivalent support for businesses not connected to the gas or electricity grid. Further detail on this will be announced shortly.

SUPPORT MUST AVOID
THE CLIFF EDGE

The government will publish a review of the scheme’s operation in three months to inform decisions on future support after March 2023.


The review will particularly focus on identifying the most vulnerable non-domestic customers and how the government will continue assisting them with energy costs.


Prime Minister Liz Truss said: “I understand the huge pressure businesses, charities, and public sector organisations are facing with their energy bills, which is why we are taking immediate action to support them over the winter and protect jobs and livelihoods.


“As we are doing for consumers, our new scheme will keep their energy bills down from October, providing certainty and peace of mind.


“At the same time, we are boosting Britain’s homegrown energy supply, so we fix the root cause of the issues we are facing and ensure greater energy security for us all.”


Kate Nicholls, CEO of UKHospitality said: “This intervention is unprecedented, and it is extremely welcome that the government has listened to hospitality businesses facing an uncertain winter. ef
“The government has recognised the vulnerability of hospitality as a sector, and we will continue to work with the government, to ensure that there is no cliff edge when these measures fall away.”

SOME BUSINESSES WILL FALL
BETWEEN THE CRACKS, SAYS FSB

Tina McKenzie, Policy and Advocacy Chair, Federation of Small Businesses (FSB) said: “This announcement will give certainty for the next six months, but a tough year remains ahead of many small firms.


“Many have been waiting for details on the energy bills support package to plan confidently for the winter and beyond, so it’s encouraging to have clarity from the Government on the form that its support will take.


“The next stage will be for small businesses to learn what the changes mean for their current contracts and for any offers they have been looking at.


“Subsidising the unit costs of electricity and gas for six months is welcome, but there are those who miss out from before the six-month period, and help must not result in a cliff-edge afterwards.
“We are calling for a hardship fund to be created for those who fall outside of the current support or for whom the current support will be insufficient.


“There will be hardship for some businesses which signed fixed contracts after prices rose but before April, who find themselves excluded from the scheme.


“FSB calls on energy suppliers to allow those customers to switch without charge to new fixed contracts, covered by the Energy Supported Price if that makes the difference for the small business to survive.


“Small businesses are the definition of vulnerable when it comes to these energy price hikes. Small firms do not have the ability to hedge, or negotiate energy prices, so we will be encouraging Government to continue to help small businesses across all different sectors after the six months have elapsed.”


Ms McKenzie called for common sense and understanding from the energy industry, which will continue to reap massive profits: “Energy companies must play their role to support their small business customers.


“Energy providers must pass on the benefit of the freeze in full and must immediately provide updated bills and quotes to each small business customer who will be wondering today what the changes mean for them.


“We’re concerned that there is no mention of a cap on rises to standing charges, which are the other main element of energy bills. While households’ standing charges will be capped, the same can’t be said for businesses. 

“We call on energy suppliers to support their small business customers by committing to lowering standing charges as far as possible.


“We’d like to see energy companies promise not to disconnect businesses from energy supply that are currently unable to pay for their energy bills this winter and not ask for disproportionate upfront payments.


“Currently, small firms could be disconnected from energy supply if they cannot pay bills after 30 days.
“We will be writing to energy companies in this regard and encourage them to support their small business customers in this difficult period.”

SHORT-TERM FIX FOR
LONG-TERM PROBLEM

Matthew Fell, CBI Chief Policy Director, said: “We welcome the government’s quick and decisive action to provide hard-pressed businesses with a substantial short-term fix to a long-term problem.
“The package will ease worries about otherwise viable businesses shutting up shop, and smaller companies especially will benefit from the discounted rate.


“Businesses will also want to know more about the exit strategy and what happens when the six-month cap runs out. Working closely with businesses will be key to successful implementation.


“The long-run solution is to double-down on energy security and to incentivise firms to push ahead with ambitious energy efficiency programmes to lower demand.”

Business

Royal George Pembroke’s kitchen closes ‘due to construction site’

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The Royal George pub has announced the closure of its kitchen until further notice, citing a significant decline in customers due to local construction works. The announcement, made yesterday, follows ongoing disruptions caused by the closure of the South Quay Car Park and the commencement of major building projects in the surrounding area.

In a statement, the pub’s proprietor Phil Lewis expressed deep regret over the decision, explaining that the impact of the construction on their food service has been profound. “After a great deal of thought and with reluctance, I have come to the decision to close our kitchen due to a significant decline in custom,” he said. The Landlord also noted that the disruption is expected to worsen as the construction project continues over the next 18 months.

The kitchen closure comes after a steady drop in food sales, which he attributed directly to the reduced footfall in the area. “Food sales have dramatically slumped and cannot sustain continued trading to the standards that Mandy and I have worked so hard to uphold,” he added.

Despite the kitchen closure, the Royal George will remain open for business. Phil has reassured patrons that bar services, including the sale of ales, wines, and spirits, will not be affected. “The pub will battle on!” he declared, thanking regular customers for their continued support over the years.

The pub hopes to resume kitchen services once the disruptions subside and some level of normality returns.

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Plans for new B&B gin distillery in St Davids refused

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A RESUBMITTED scheme for a gin distillery as part of a B&B in the centre of Britain’s smallest city has been turned down by Pembrokeshire national park planners, with hopes the applicant may try a third time as a distillery only.

Last October, Pembrokeshire Coast National Park planners refused an application by Neil Walsh for a change of use of the exiting guest house at St Davids Distillery, Restaurant & Rooms, 11-13 Nun Street, St Davids to include the bar/restaurant and distillery.

The plans for the Grade II-listed property had drawn 23 responses of concern, including intensification of use from the bar, impacts on local amenity, and Health and Safety concerns about the installation of a still and the use of ethanol, with fears of a fire and explosion risk.

The scheme – supported by St David’s City Council – was partly retrospective as the gin still had been installed, but was not currently in use, in the distillery sited below existing bedrooms at the guesthouse.

The latest application, a mixed use of 11-13 Nun Street as a bed and breakfast and housing part of the gin distillery plant, was again recommended for refusal. At the October 16 meeting of the park’s development management committee.

It was proposed that the ethanol and botanicals would be stored off-site and brought onto the premises only when distilling is taking place; 30 days a year, with no guests on site.

There were 15 letters of objection to the scheme, raising concerns including it “could result in death, injuries and large-scale damage to property”.

An officer report said mitigation measures suggested in order to minimise the risk associated with ethanol for gin production “would not, in the opinion of the authority, be reasonable, practical or enforceable”.

Speaking at the meeting, Mr Walsh said the scheme would help safeguard 11 jobs by diversifying the existing business, with hopes of creating further jobs in the future.

Mr Walsh, who owns a nearby restaurant, had said tourism had declined as there had been “confidence back for the UK market to travel abroad,” and gin production would help market St Davids as a global brand.

Addressing safety concerns, he said the still, sited retrospectively in order to comply with distillery licensing, had been installed by a “world-class master distiller,” who had previously installed a still some two-and-a-half times larger on a P&O ferry.

He told members the ‘spirit tourism’ business was worth hundreds of millions of pounds in the UK, with Welsh Government funding for a Penderyn distillery visitor centre, adding: “if this was dangerous and irregular why have government given money?”

A sticking point for members was the sharing of the distillery with the B&B, pondering whether Mr Walsh – who was broadly positive – could resubmit an application for a distillery only, after hearing that could not be suggested as an amendment to the existing scheme.

Moving the application be refused, Cllr Di Clements said: “It’s a real shame because it’s such a good idea, nobody is against what Mr Walsh wants to do; it’s the combination which is the issue, I hope Mr Walsh can come back with another application if this fails.”

Dr Rosetta Plummer, who seconded refusal, praised the applicant’s “passion and clarity,” adding: “Unfortunately, we are bound to make a judgement on what is before us today.”

The scheme was refused by 12 votes to two.

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Keel laying ceremony for Milford Haven Port’s new pilot boat

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A SIGNIFICANT milestone has been reached at the Port of Milford Haven today with the keel laying ceremony for its new state-of-the-art 22-metre pilot transfer vessel. The vessel, currently under construction by Next Generation Shipyards, is the first step in a multi-million-pound investment programme aimed at enhancing the Port’s pilotage services.

The keel laying ceremony, traditionally marking the official start of a ship’s construction, highlights the Port’s continued commitment to improving safety, reliability, and operational efficiency. This new vessel will play a vital role in maintaining the high standards of pilotage at the UK’s leading energy port.

The official keel laying ceremony for the Port of Milford Haven’s new pilot
transfer vessel took place on Wednesday (Oct 16)

Harbourmaster at the Port of Milford Haven, Mike Ryan, spoke of the significance of the event: “Today’s keel laying ceremony is a momentous occasion for everyone involved in the project. This new vessel represents our commitment to continuous improvement and operational excellence. As the UK’s leading energy port, we understand the importance of having world-class infrastructure to support our customers and maintain our competitive advantage.”

Wayne Busby, Watch Manager at the Port, expressed his anticipation for the vessel’s arrival next year, noting: “The Marine team is eagerly awaiting the delivery of our Next Generation pilot transfer vessel. We face some of the most challenging weather conditions in the world, and this substantial investment will ensure we can continue providing excellent service long into the future.”

Next Generation Shipyards, known for its innovative designs and craftsmanship, is building the 22-metre vessel to meet the unique demands of pilot transfer operations. With advanced safety features, improved sea-keeping abilities, and cutting-edge technology, the vessel is designed to optimise performance in harsh conditions.

Technical Director at Next Generation Shipyards, Dirk Keizer, commented: “With this keel laying, the construction has begun for an extraordinary vessel. The technical and comfort capabilities combined with self-righting technology make this vessel stand out. We are pleased to contribute to the Port’s future and are involved in maintenance and training programmes to ensure smooth operations.”

Steven Lee, Chief Naval Architect at BMT, added: “This milestone reflects the dedicated efforts of the project team over the past ten months. This new pilot boat will meet regulatory and operational standards, setting a new benchmark for heavy weather operations. We look forward to supporting the vessel through its construction and trials.”

Ed Soothill, Technical Director at Camarc Design, also highlighted the significance of the project: “We have worked closely with the Port of Milford Haven and NG Shipyards to develop a pilot boat that can handle very demanding operational conditions. We are delighted to see the project reach this stage and look forward to its completion in 2025.”

The new pilot transfer vessel is expected to enter service in 2025, reinforcing the Port of Milford Haven’s commitment to providing safe and efficient marine services. This vessel will be a cornerstone of the Port’s long-term investment strategy, ensuring its continued ability to serve a wide range of vessels.

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