On-going Government energy support is essential for the future of UK ceramics

• The introduction of the non-domestic Energy Bill Relief Scheme (EBRS) was a lifeline for UK ceramics, but it is due to end in March 2023.• The Government is expected to announce soon what further support it will provide to industry once the current EBRS ends.• The UK ceramics sector, a gas-intensive Foundation Industry, is calling on the Government to extend the support of the EBRS for energy intensive industries.• Recent record increases in the price of gas of up to 20 times previous levels are not sustainable.• Volatile energy prices are adding tens of millions of pounds to UK ceramic company’s gas bills, with some seeing rises from £1.1m for six months to nearly £12m.• Competitive energy and carbon prices are needed to give energy intensive industries a level playing field internationally.• While the Government has given £2bn to some industries to help with electricity bills over the last 10 years, it has only helped electro-intensive industries. But less than five per cent of the UK ceramics sector qualify for electricity bill support.• Only a small percentage of UK ceramics manufacturers meet the threshold to qualify for renewable energy support on their electricity costs. The Government needs to address this urgently.Rob Flello, Chief Executive of the British Ceramic Confederation (BCC), said: “UK ceramics is at the very heart of what the UK needs for a strong, stable manufacturing backbone.“Without refractories there is no UK steel or UK glass industry, and without the brick, tile, and clay pipe manufacturers there would be no housebuilding. There is no heat from waste without advanced ceramics, the list goes on.“However, UK ceramics is one of the most energy-intensive manufacturing industries in the UK, due to the need to fire products at very high temperatures. Therefore, the energy crisis has delivered a body blow to our sector.“As a gas-intensive industry, the rising costs are unsustainable, with manufacturing facing 10-fold and at times far higher energy price increases. Such volatile energy prices are adding tens of millions of pounds to company bills, with some seeing rises from £1.1m for six months to nearly £12m. Gas increases of up to 20 times previous levels are simply not sustainable.“The majority of our members have energy contracts that run into next year, while others are currently negotiating such contracts. However, these contracts have been very expensive to secure, and in some cases, require upfront payments and deposits. Some suppliers are also finding ways of adding massive surcharges.“Whilst we welcomed the Government’s non-domestic Energy Bill Relief Scheme as a lifeline, their announcement of a review sparked concern. We warned that if Government support was downgraded, then this industry would be on a cliff edge. The Government must not leave us in a precarious position.“The Government needs to signal that it understands how important Foundation Industries are to the wealth and stability of the UK; for investment, jobs, and the levelling up agenda.“Therefore, it is essential that Government continues to provide protection and support for Foundation industries such as UK ceramics.The British Ceramic Confederation has made detailed representations to Government both individually and as part of the Energy Intensive Users’ Group in calling for further support for our members and the wider UK energy intensive industries.“Internationally competitive energy and carbon costs are also essential if we are to compete on a global stage.“Looking to the future, the sector is committed to decarbonising in line with the UK’s ambition for net zero by 2050, and UK ceramics is playing its part, but without Government support during the energy crisis, there are no guarantees our industrial sector will be around in 2050.”