RETAILERS WARN ELECTRICITY COSTS TO RISE £440M THIS YEAR

The British Retail Consortium has urged John Healey to cut the levies added to business energy bills, warning that retailers' electricity costs are set to rise by £440m this year. The trade body, which represents retailers including Tesco, Sainsbury's and Marks & Spencer, said sector-wide electricity costs will climb from £2.72bn last year to £3.16bn this year. BRC chief executive Helen Dickinson said the Chancellor must take immediate action to reduce what she called a "plethora of policy levies" on business energy bills. The BRC said the increase would push up prices for shoppers.

According to the BRC, most of the rise comes from government-levied charges rather than the global increase in energy prices linked to the war in Iran, with policy costs now making up two-thirds of retailers' electricity bills. Transmission Network Use of System charges, which fund grid construction and repairs, are forecast to rise 72 per cent, adding £200m. The renewables obligation, which funds large-scale electricity generation, is set to rise 2.5 per cent to £646m. The climate change levy, meant to encourage energy efficiency, is projected to rise 2.2 per cent to £151.7m.

The BRC said retail is one of the UK's most energy-intensive industries, with electricity accounting for 90 per cent of the sector's energy use. Dickinson's appeal for the Chancellor to cut policy levies forms part of the BRC's call for government action on business energy costs. The organisation said reducing the charges would ease pressure on retailers and limit the impact on prices paid by consumers. No response from the Chancellor had been reported at the time of the BRC's statement.