By Daniel Hunter

Energy intensive businesses are being told how to claim compensation to offset the cost of energy policy in their electricity bills with the publication of new government guidance.

The guidance is being published alongside the government response to its consultation on a £250 million Energy Intensive Industries Package.

Eligible firms will be able to apply from 3 June as part of measures to reduce the impact of energy and climate change policies on the cost of electricity for energy intensive industries in the UK.

The guidance sets out how businesses can claim compensation from the first tranche of the £250 million for the indirect costs of the EU Emissions Trading System (EU ETS). Up to £113 million has been allocated for this scheme.

“Energy intensive industries are a critical part of the UK economy. It is essential that as we put in place policies to generate the necessary investment in energy infrastructure we do not undermine the competitiveness of UK industry," Business and Energy Minister Michael Fallon said.

“This compensation package will support firms, protect jobs and help reduce the risk of industries leaving our shores.

“The energy intensive industries also provide many of the components for low carbon goods. For example, steel is vital for the manufacture of wind turbines”.

The government has also committed to establishing a compensation scheme to address the indirect costs of the Carbon Price Support (CPS) mechanism, subject to state aid clearance. That scheme is currently being considered by the European Commission and will be announced later this year.

Applications for the EU ETS scheme can be submitted from 3 June 2013, when the form will be made available on the GOV.UK website.

The deadline for applications for compensation which includes costs incurred from the 1 January 2013 will be the end of July. Applications received after the end of July will not be considered for costs already incurred.

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