Scottish Government Response to British Industrial Competitiveness Scheme: Consultation on Regulatory Changes and Scheme Delivery

Policy executive summary

This section sets out a high-level summary of the policy positions taken in this consultation response.

The scheme aims to reduce electricity costs for manufacturing frontier industries within the Industrial Strategy’s growth sectors (the ‘IS-8’) and manufacturing foundational industries which provide key inputs to those frontier industries. To be eligible, businesses must meet an electricity intensity threshold. Eligible businesses are to be exempt from paying the indirect costs of the Renewables Obligation (RO) and Renewables Obligation Scotland (ROS), Feed-in Tariffs (FIT) and the Capacity Market (CM).

Confirmation of regulatory changes

The Scottish Government will proceed to implement BICS by amending the relevant ROS legislation to exempt BICS-eligible businesses from up to 100% (subject to pro-rating) of costs passed onto them by electricity suppliers. For the ROS, an ‘indicative level’, suggesting how the obligation for Scotland will be adjusted to account for the BICS exemption, and will be published alongside the obligation level for 2027 to 2028 by 1 October 2026. This indicative level will provide an indication of what the obligation level is likely to be, once the BICS exemption is implemented. A final BICS-adjusted obligation level, taking into account final estimates of the amounts of BICS-exempt electricity to be supplied, will then be published before 1 April 2027. Subject to the agreement of Scottish Ministers, the Department for Energy Security and Net Zero (DESNZ) undertakes the calculation of the Renewables Obligation on behalf of the Scottish Government, drawing on agreed assumptions about expected generation from Scottish stations.