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Business
Jun 15, 2026
Analyzed by GPT OSS 120B

Manufacturers and Unions Warn High Electricity Prices Are Killing UK Industry

AI Summary
Make UK and the Trades Union Congress have warned that sky‑high electricity costs are eroding the competitiveness of UK manufacturers, prompting a call for a £3 bn expansion of the BICS relief scheme. Their survey shows production moving overseas, delayed investment and job cuts, while the government faces a £600 m levy‑removal cost dilemma.

Manufacturers and Unions Call for Immediate Electricity Price Relief

Make UK and the Trades Union Congress (TUC) have jointly appealed to the cabinet for urgent action to curb the nation’s soaring electricity prices, arguing that the current situation threatens the very survival of the UK’s industrial base.

Survey Reveals Escalating Strain on UK Manufacturing

The latest Make UK member survey highlights several alarming trends:

  • Almost 1 in 10 firms have already shifted production abroad; 16% are considering it.
  • Nearly 4 in 10 companies have postponed investment projects.
  • More than 20% report reduced headcount, affecting the sector’s 2.5 million workers.
  • UK manufacturers face the highest electricity prices in the G7 – up to four times those paid by US counterparts.

Financial Toll: £3 bn Expansion Cost and £600 m Levy Removal

The specific demand is to broaden the scope of the British industrial competitiveness scheme (BICS) from the current 10,000 qualifying firms to all 130,000 manufacturers, an expansion that £3 bn would fund.

Separately, removing three electricity levies would cost about £600 m, a sum the chancellor expects to cover through energy‑system reforms and Exchequer funding.

Implications for Competitiveness and Employment

Without broader relief, the sector’s growth outlook remains bleak, with Make UK forecasting only 0.4% growth this year and 0.1% next year. The hidden cost is the potential relocation of multinational production, which could further erode UK manufacturing capacity and jobs.

Outlook: What Policy Shifts Could Stabilise the Sector?

Analysts suggest that a more expansive, tax‑based approach—similar to practices in France and Germany—could distribute the energy transition burden more evenly and preserve industrial competitiveness. Until such a strategy is adopted, the industry risks continued under‑investment, job losses, and a slide toward deindustrialisation.