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EII exemption changes are less than a year away

April 2019

With the expected implementation date for new EII exemption levels set at 1st April 2020, businesses now have less than a year to get ready for the changes. Government’s proposed plans will have implications for businesses who qualify for the first time, as well as those who don’t.

With so many policy and regulatory changes affecting the energy marketplace right now and with the decision on thresholds yet to be announced, businesses could be forgiven for putting EII to the bottom of the pile. However, preparation is everything when it comes to your energy budget and, for many businesses, a year is a short amount of time to plan for change.

Recap: what are EII exemptions?

Energy Intensive Industry (EII) exemptions protect the UK’s intensive industries from higher energy charges related to environmental subsidies including the Feed-in-Tariff (FiT), Contracts for Difference (CFD) and Renewables Obligation (RO) scheme. The aim of the exemptions is to ensure those businesses can remain competitive with their European counterparts, who have lower energy costs.

Stay tuned in

With the government now proposing to widen the qualification criteria and the implementation date less than a year away, it’s crucial for businesses to understand what the changes could mean to them.

As soon as threshold changes are confirmed by the government, businesses will need to act to ensure that they are not burdened with unnecessary charges if they do qualify but haven’t applied in time, or unexpected energy costs if they don’t.

For those who don’t qualify, changes to EII exemption will, unfortunately, mean higher energy costs, as the amount which newly exempt businesses would have paid will need to be absorbed by the remainder of the marketplace.

To find out how the proposed changes could affect your business, please visit our EII infographic.

Are you entitled to EII exemption?

For those who have never hit the energy intensity threshold for EII exemption before, it will be worth checking again. A combination of lowered thresholds and increased energy prices may mean that you qualify under the new rules.

Guidance on EII for those who don’t qualify

For those who don’t qualify, it will become more important than ever before to mitigate the rising cost of energy. Energy efficiency is one way to do this and businesses should make the most of the opportunities presented by ESOS and the new Streamlined Energy and Carbon Reporting scheme (SECR).

Both schemes are mandatory for eligible businesses and provide a genuine and valuable opportunity – but many businesses who have already completed ESOS Phase 1 failed to act on their findings. This despite the schemes being designed to enable cost and carbon savings in an increasingly expensive marketplace. Implementing the findings of your ESOS and SECR reporting can not only boost the business bottom line in the short term but also provides invaluable resilience against energy marketplace changes in the future.

It’s also important to note is that SECR will not replace ESOS: future phases are expected to continue as planned. It is estimated that 11,900 companies will need to comply with SECR and some of those will also need to comply with ESOS. Yet another reason to make sure your business is getting maximum benefit from compliance.

Read more about ESOS and SECR in our blog here.


Want to reduce the resource burden of compliance? Inenco’s compliance team have the experience you need. With their support, compliance can be hassle-free for your business. Get in touch today by calling 08451 46 36 26 or email