Ministers say more than 7,000 British businesses will see their power bills fall by up to 25% under a new scheme launched today.

Business Secretary Peter Kyle used his keynote speech at the CBI Conference to hammer home the message that high electricity prices are choking investment.

He said innovators have been held back for years and it is time to remove the drag on growth.

He announced an eight-week consultation on the British Industrial Competitiveness Scheme. The plan will slash electricity costs from April 2027 for manufacturers in frontier sectors like automotive and aerospace and for the chemical suppliers behind them.

British industrial power prices remain among the highest in the G7. Ministers say this undermines competitiveness and pushes viable firms towards overseas finance and foreign markets.

Kyle also promised a new five-year plan for the British Business Bank to break the scale-up bottleneck. The Bank will increase its pace of investment by two thirds and push £4 billion into high-potential firms so they can grow at home not abroad.

He said: “I have listened to business on both these issues and today we’re taking action. This is just the start and in the months ahead I will be going further to address business concerns reverse our industrial decline and make the UK the best place to start and scale a business.”

Industry groups have warned repeatedly that energy costs are choking competitiveness.

Surveys show nearly two thirds of manufacturers see power prices as a major threat to long-term investment.

BICS will cut eligible firms’ costs by £35-£40 per megawatt hour. It will deliver exemptions from RO, FiT and Capacity Market charges to stabilise bills and protect skilled jobs across the country.

The scheme follows the British Industry Supercharger upgrade which launches in 2026. That move boosts network charge discounts for sectors like steel and cement from 60% to 90%.

The consultation is open until 19 January with final decisions due in the spring.