UK GOVERNMENT plans to cap energy costs for businesses will still leave pubs with bills 300 per cent higher than normal, a leading trade body has warned. 

The Energy Bill Relief Scheme announced on Wednesday will see the government intervene to limit the power costs for businesses and other non-domestic customers for the next six months. 

READ MORE: Energy bills for businesses to be capped in £25bn intervention

Under the measure, the wholesale price for electricity will be capped at £211 per megawatt hour (MWh) for electricity and £75 per MWh for gas - roughly half of what the cost would be after October's price rise. 

The Scottish Licensed Trade Association welcomed the scheme but warned that businesses could still be forced to close.

Managing director Colin Wilkinson said: “This is news that we have been waiting for and obviously we welcome it but when you look beyond the headlines it doesn’t live up to the hype as this new scheme caps the wholesale price and pubs and bars could still be paying 200-300% higher bills than normal."


He added: “There are pubs and bars currently on a rate of 90p per kWh, in comparison to 15p in normal times.

"The government says that the current wholesale price of gas is about 42p per unit therefore businesses should see a reduction of 21p in their unit price but this still means much higher bills than before the energy crisis.

“Nothing in the plan tackles the problems of large deposits and bonds, particularly for the SME independent sector, nor restricts the additional margins made by the energy suppliers.

“The SLTA is concerned this may not be the lifeline we were all hoping for and today’s announcement is not enough. More needs to be done to help the struggling hospitality sector through the winter months.”

Scottish Chambers of Commerce chief executive Liz Cameron welcomed the scheme but said a six-month cap was not enough.

She added: “We are concerned that even more sudden rises in energy bills will await firms once the cap is lifted.

“We would urge the UK Government to engage immediately with the business community to properly define the ‘vulnerable industries’ cited for support after the original six-month cap.”

Meanwhile, Scottish Secretary Alister Jack said the scheme will “give much-needed certainty to Scottish businesses, schools, hospitals and other public services and is being introduced as a matter of urgency as we move into winter”.

He added: “This comes on top of the Prime Minister’s monumental intervention for domestic customers, saving the average household £1,000 per year on fuel bills, and in addition to the £37 billion package of support announced earlier this year.

“The UK Government is also taking vital steps to strengthen our energy security.

“The UK Treasury was able to give support to people up and down the country when we faced Covid and its strength is proving vital again as we continue to tackle the rising cost of living.”