British Industrial Competitiveness Scheme (BICS): Renewables Obligation - business regulatory impact assessment

Section 2: Engagement and information gathering

The Scottish Government has undertaken a structured engagement approach to support the development of this policy. A public consultation was undertaken to gather views on the proposed changes to ensure both transparency, and provide an opportunity for broad participation in the policy process.

Engagement was also undertaken internally with relevant policy leads to understand the impacts of the policy change on industry. Additionally, there has been ongoing engagement with UK Government throughout the process to ensure alignment and consistency.

2.1 Business/Third Sector engagement

The Scottish Government has proactively engaged with businesses and UKG officials through various channels such as webinars where issues of eligibility, timelines and benefits were discussed and made clear.

2.2 Internal SG Engagement

Internal engagement with policy leads for Industrial Decarbonisation and Food and Drink took place prior to the consultation to develop our understanding of the impacts of the proposed amendments

2.3 UK / Devolved Administrations

There has been continued engagement with UK Government throughout the policy development process to ensure alignment on changes to the respective RO schemes.

2.4 Wider Public Sector

No wider public sector engagement was required

2.5 Other Key Stakeholder

Engagement with the renewable energy industry via bodies such as Scottish Renewables has confirmed there is no expected impact on renewable energy generators supported by the ROS.

2.6 Public consultation

Following a UK-wide consultation on the approach to, and eligibility for BICS (published last November), UKG launched a second consultation on BICS scheme delivery on 16 April 2026. As decisions on scheme operation and eligibility are reserved to Westminster, a separate consultation was launched by the Scottish Government which sought views on the regulatory changes required for ROS only.

The consultation ran for two weeks between 16 June and 30 June 2026, and sought views from Citizen’s Advice, Consumer Scotland, electricity suppliers and generators, as well as businesses and any other concerned stakeholders. A total of nine valid responses were received.

The consultation asked two questions of stakeholders;

1. Do you agree with the proposal to amend the ROS order to exempt BICS eligible businesses from up to 100% (subject to pro-rating) of ROS costs passed onto them by electricity suppliers?

2. Do you agree with the proposed changes to the arrangements for setting the obligation level for Scotland for 2027 to 2028, including the proposal to publish an adjusted obligation level, which accounts for the BICS exemption before 1 April 2027?

On Question 1, while the majority of the respondents agreed with the proposals to amend the ROS Order to allow for the implementation of BICS, concerns were raised around the potential redistributive impact of change which could see ROS costs displaced onto non eligible businesses and consumers. Another point raised was BICS could create a disincentive for eligible businesses to invest in onsite renewable energy generation.

On Question 2, while the majority of respondents agreed that publishing an adjusted obligation level was necessary to avoid risk premiums being priced into electricity tariffs by suppliers, concerns were raised that suppliers would not be able to reflect the changes in customer tariffs until BICS eligibility was clear.

It was also raised that market participants are being asked to act upon an adjusted obligation level before the information needed to assess the implications is available.

A full Scottish Government response to the consultation responses received was published on the Scottish Government website: Scottish Government Response to British Industrial Competitiveness Scheme: Consultation on Regulatory Changes and Scheme Delivery

Responses to the consultation were carefully considered in the development of the final policy approach. Stakeholder feedback supported the objective of reducing electricity costs for eligible businesses to improve competitiveness, while also emphasising the need to minimise impacts on other consumers. These views informed the Scottish Government's assessment of the proposal. As a result, the Scottish Government intends, subject to parliamentary approval, to proceed with the proposed regulatory changes to existing secondary legislation relating to the ROS.