Businesses welcome price cap announcement as a “huge relief”, but warn further support will be needed if they are to survive

Julie Dunn, Operations Manager at Dunns Food and Drinks
  • Scottish business react to UK Government’s Energy Bill Relief Scheme, which sees wholesale gas and electricity prices fixed for six months from 1 October
  • Hospitality venues say the move is a “huge relief”, but stress support must continue if businesses are to survive beyond winter 
  • One business owner even considered using candles instead of switching on lights in a bid to curb bills
  • Leading wholesaler Dunns Food and Drinks: “Prices will continue to rise unless blanket price cap is introduced across Europe”  

BUSINESS owners in Scotland have described the latest energy price cap announcement as a “huge relief”, but say further support will be crucial if they are to survive beyond winter.  

The UK Government today (Wednesday 21 September) announced a package of support, which will see gas and electricity prices fixed for all firms for six months from 1 October. 

Under the Energy Bill Relief Scheme, wholesale prices are expected to be fixed for all non-domestic energy customers at £211 per MWh for electricity and £75 per MWh for gas. 

The announcement has been largely welcomed by business figures across several industries, however bosses have warned of potential job losses and increased costs for customers when the scheme ends in April. 

Fergus McCoss, co-founder of Glasgow-based Hinba Coffee Roasters, said the announcement was a “huge relief”, but believes additional support will be needed. 

He said: “The imposing energy price hike was causing us lots of stress. We found ourselves thinking of ways we could be smarter about our energy consumption. 

“We considered changing the settings on our coffee machines and only using one of the decks on our double deck oven to save some money. 

“We even thought about using candles in certain parts of the shop to avoid switching on as many lights.

“While we’ll still have to implement some of these changes, this support package takes a big weight off our shoulders. 

“It can’t stop there, though. When April comes and the scheme stops, businesses will still need support if they’re to survive and keep people in jobs.” 

Edinburgh-based Cairngorm Coffee Roasters use gas-powered coffee roasters to roast around 250kg of coffee beans every week. Co-founder Harris Grant said that while the cap is welcome, he is still “very worried” about the impact of price increases. 

“Rising costs off the back of covid will be seriously difficult for businesses to deal with,” he said. 

“While it’s good to have some certainty, at the end of the day, it’s still a cap on prices which are significantly higher than this time last year.

“We’re doing our best to support our staff by paying them the National Living Wage, but with the price of coffee going up too, we’re going to be facing some significant cost increases for both us as a business and for our customers – cap or no cap.”

Seaweed seasonings and ingredients producer Mara Seaweed believes the introduction of a price cap will give them greater control over their business costs. 

Founder Fiona Houston said:  “With volatile gas prices, it’s very difficult to manage and forecast costs and cash flow effectively.

“Seaweeds are made of up to 90% water and we bring this right down to produce high quality Scottish dried seasonings; the energy used for this process is one of the main production factors we need to consider. A sustained increase in energy costs would inevitably push the price of our products up which would also impact our customers.

“An energy cap is great news for us, allowing greater clarity on the future costs of our products and ensuring we can keep supplying a great quality product at sustainable price for our customers and consumers.”

She continued: “This really puts into context how important it is for business and government to prioritise exploring different ways we can power our industries. 

“Now more than ever, it’s important to push the boundaries and develop the infrastructure and technologies needed to allow a transition away from fossil fuels for good.”

Julie Dunn, operations manager at leading Scottish wholesaler Dunns Food and Drinks, said: “These measures give much needed certainty to us and our customers, especially after a difficult few years. 

“Whilst six months of support may not help all businesses, it does bring some relief within the retail and hospitality sectors to allow trading through the vital Christmas period. However, it’s important to stress this is not a silver bullet that is going to fix all the problems facing the sectors. 

“Unless a blanket price cap is introduced across Europe, we’re still going to see prices go up. The UK is heavily reliant on imported produce, and unless we see fixed wholesale energy costs then prices are going to continue to rocket.” 

The latest energy price cap announcement comes ahead of the Chancellor’s so-called “emergency mini-budget” later this week (Friday 23 September). 

Kwasi Kwarteng is expected to unveil a package of tax cuts, including a reversal of the national insurance increase and scrapping the planned rise in corporation tax

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