Name: Energy Incentives - How to claim significant tax relief on your energy costs?
Uploaded: 2025-04-29T09:16:09.659Z
Duration: 53 min 24 s
Description: Energy Incentives - How to claim significant tax relief on your energy costs?

Transcript for "Energy Incentives - How to claim significant tax relief on your energy costs?": You're gonna do that with are you gonna say the initial ones? Yeah. I think that's us, live now. So hello, everyone. That's us live. We are just waiting. We're gonna give a couple of people a few more minutes to see if they'd like to join, and then we will kick off. Okay. While we get started, thank you everyone for joining us for our energy tax incentives, how to claim significant tax relief on your energy costs webinar session. My name is Sarah Glanville. I work for Leyton UK, and I'm delighted to be able to work really closely with the Scottish Engineering team. I look after our membership relationship network and yeah. So I work very closely with John, and I've had the pleasure of working closely with the team to get this webinar up and running. But I'm gonna pass you over to John to kick this session off today, and then we'll pass back to the leasing team to discuss energy tax exemptions and and how they are suitable for businesses like yours. So thank you everyone for joining, and, John, I'll let you take on from here. Thank you, Sarah. So I'm John. I work with Team of Scottish Engineering, and thank you very much for joining us this morning. I think as we all know, energy costs are a huge issue in our sector. In Scottish Engineering, we have a broad base of members, the length in Bristol Scotland, about about 570 and growing, representing a wide variety of the engineering and manufacturing sectors. We're out and about, talking to our member companies week in, week out about their their issues, about their challenges, their opportunities, so we can support them. And as as as people will recognize in this webinar, there are some real challenges out there at the moment facing members' economic uncertainty, export rules, tariffs, and national insurance increases, skills availability. The list goes on. But there's always one issue which comes up again and again, and that is the spiraling energy costs. British companies are paying the highest electricity prices anywhere in the developed world. The the cost of power for industrial customers has jumped by a 24% in just five years, and that's according to UK government's own figures, taking us to the very top of international week table. And it's not about it's now about 50% more expensive than in Germany and France and four times more expensive than in The US. And these these figures are, of course, a huge concern, particularly for energy intensive businesses, but but also for any company who has whose energy bill is a material part of their of their cost base, which is most in many cases, they are crippling domestic, you know, companies who have moved overseas or or reduced production output, etcetera, because of energy costs. There are no magic solutions to us and for us, but we were really interested when when Layton, our member company Leighton, suggests that running a webinar to to make sure that companies are aware of the range of incentives, exemptions, compensation schemes, etcetera, that are available for business. Being aware, of what is available, whether your business should be eligible and whether you're getting access to these schemes could be vital in mitigating your energy bills. And then that brief introduction, I'm now gonna, pass over to Zachary. Thanks, John. And thanks for thanks for setting the scene quite nicely, particularly when it comes to the cost of energy, in The UK, which, as you point out, is is is very different to what it was ten years ago, or certainly fifteen year years ago when I started at LNG. Let me do a brief introduction myself, and I've got my colleague Dean here today. So, first of all, myself, my name's Zachary. I head up energy here at Leyton. My background is is energy over the last fifteen years. I come from an energy consultant background and then an energy supplier background. So I've, spent a lot of time with large organizations helping them procure their energy and, buy energy at the right price at the right time, etcetera. And I've also worked, with energy suppliers. I've worked at a number of energy suppliers, so, TotalEnergies and Corona Energy, around supporting businesses be more efficient with their energy usage. And for the last coming up to three years now, I've been at Leyton. And at Leyton, I've been helping businesses really understand what is available to them to reduce their energy bills, but particularly the non commodity side of their energy bills, which which I'll talk about shortly. And, Dean, do you want Dean, do you wanna give yourself a quick introduction? Yeah. Very very quick. And so I'm the sort of commercial lead on the energy side of Leyton. Been here for four years now, and, you know, I've helped a a wide sort of breadth of companies take advantage of all these different incentives we're gonna talk about today. Fantastic. So to to set the scene scene a bit, I would think a bit about what John just said, which is the cost of energy is is very different now to what it was five years ago. I started in energy about fifteen years ago, and in general, the cost of energy would fluctuate, but those fluctuations tends to be fairly small. So if you if you bought energy at the right time, you might save a bit of money. If you bought it at the wrong time, you might lose a bit of money. But those those actual costs themselves didn't necessarily move a drastic amount. We then suddenly saw energy prices spike, February, '2 thousand and '1 for a number of different reasons. And some of those reasons, were economic. Some of those reasons were around world politics, and some of those reasons were around the climate. What's interesting is is none of those reasons for energy spike, energy prices spiking have gone anywhere. They might not necessarily be headline news, but they've not gone anywhere. And that's why the cost of energy is still such an important piece for certainly for engineering businesses such as yourselves. I think it's it's absolutely key, the cost of energy. The other thing with energy is is the cost of energy is being essentially into two. You have commodity, the price of energy, and that's what spiked, and you have non commodity. Non commodity is made up of numerous different things. I won't go into all of them. But if we break them down, say, significant part of those are are taxation of some form. And what's interesting is they're also rising. Maybe not with the spikes that we saw in the energy market due to conflicts in Ukraine and, political, domestic political movement and the climate and all sorts of things in COVID, but they have steadily got quite consistently, actually, over probably the last six, seven years. And that non commodity side is a side that you can have a look at and see whether or not there are is an opportunity there for you to reduce your costs. And a lot of businesses don't because they don't think about this. And, certainly, when it comes to procuring energy, and my old background, most energy consultants and probably energy suppliers are only really looking at the commodity side for businesses. The non commodity side, these taxations and these opportunities to reduce the taxation is is something a lot of people don't look at. So what we do at Aetna, that's what we look at. We're not an energy broker or consultant. What we don't do is we don't procure energy for businesses. What we do do is look at the taxation, the real specific energy taxation. And in particular, what we're looking at is we look at some of the schemes that are available for businesses to apply for one of two things, either an exemption to some of those taxation, so reduce your bill. Or, actually, there are some schemes out there that offer compensation. So the government offers compensation back to you, to help you with the cost of your energy bills. And there's schemes that aren't necessarily advertised. They're not out there. People aren't telling everybody about these things, but they do exist. And and certainly, myself and Dean talk to businesses every day who were either not aware, that they could be exempt from some of these costs, or weren't necessarily aware of how to go about it. And that's what we're gonna talk about today. So two real schemes we'll probably touch on. I I might talk about one or two others, but there's two really, really key schemes to talk about. One of them is the EII exemption scheme, so, energy intensive industries exemption scheme, something that I would guess a lot of you guys on the call today may well be or or should be having a look at, and The UK ETF compensation scheme. So the two different schemes, one of them exemption, one of them compensation. That's what we're gonna talk about today, and maybe touch on one or two other things. So, as my myself and Dean have a conversation, feel free to drop some some questions in there. If you've got any, feel free to ask us. We'll we'll pick up any questions at the end, and we're definitely here to help. So let's talk about, first of all, EII exemption. And I think probably I will, Dean, Dean's the expert on this area, so I'll probably pass to Dean in terms of maybe give that kind of brief explanation. So maybe, Dean, do you wanna start by giving us a bit of an overview of what the EI exemption scheme, is? Yeah. Of course. So the EII exemption, it stands for Energy Intensive Industries exemption, is an exemption from four of the sort of taxes or levies imposed on your electricity supply. So if you look at the bill and it's a nice itemized bill, you might see renewable obligations, contracts for difference, feed in tariff, and recently, they added in capacity market charges to the exemption. And if if you're a business that's doing the right manufacturing activity, which I believe a lot of you use in Scottish Engineering would be, and you can demonstrate that you are an intensive user of electricity against some of your financial metrics, then you can essentially apply for a certificate from the department from business and trade that deems you EII exempt. And once you've got that certificate, that certificate goes off to your supplier, and some suppliers treat it differently. But, typically, what they'll do is if you get a % exemption, you will get those line items zeros on your bill. Sometimes, you might not get a % exemption, and that's, you know, typical and fair. You might be manufacturing two products, for example. Only one's eligible and one is not. So you might get a 50% exemption, so on and so forth. But it's it's, a great exemption that was really introduced to to help UK businesses to keep their manufacturing activity in The UK. You know, what what they what they coin that as, I think, is carbon leakage. So it's to prevent carbon leakage moving abroad where it may be cheaper to to manufacture. And removing those four taxes can make a considerable dent in your electricity bill. Okay. I I think my there's a lot of certainly within within the energy industry, there's probably a lot of talk around the The UK's energy strategy or the government's energy strategy. I I mentioned before energy spiking energy prices. I think one of the challenges that that, has been there has been certainly from a domestic point of view, we we've obviously had a fairly fluctuating, political climate. I won't get into politics, but it's fluctuating political, outlook in The UK for the last four or five years and the number of prime ministers and change of government. And, of course, we had another change of the government last year. There's certainly a lot of talk about what the current energy, policy is. I think one challenge that the government has is balancing the requirement to go down a, a more, sustainable route when it comes to energy supply, but also the costs. And this is this is the the constant challenge that I think governments have had over the last few years is, one hand, the absolute general cost right now of your energy bill. Certainly engineering businesses, large organizations, energy intensive businesses, but also that requirement to to go to be sustainable. And I think this is an example actually of whereby the government's got a leader that they can pull support certain industries and certain sectors. So my my feeling will be, and this is more of a personal feeling, but my feeling will be one tactic the current government may use over the next three, four years to help reduce energy bills for organizations such as engineering businesses is schemes such as this because what it allows them to do is continue to, generate income for sustainable schemes whilst also supporting large organizations or energy intensive organizations in reducing their bills. So I think this is a it's an interesting scheme. It's a scheme I think potentially could roll out or or be extended. I mean, is is that the case, Dean? So there's network charges, I think, as well, the the end the network charges compensation scheme. Is that linked to the EII exemption scheme? Yeah. So recently, they essentially, they extended the EII exemption to include a network charges compensation. So what what does that mean? If you have an EII certificate, you can get compensation to offset up to 60% of your network charges. And sometimes those network charges can be massive because of where our business is located, how much infrastructure there is to actually get the energy to the site, etcetera, etcetera. So they they rolled that out most recently, and there's a an instance where businesses who, for example, are not actually paying some of the EII taxes may benefit from having an EII certificate solely to get the network charges compensation. And it actually it leads into quite a a a good point, Takoff. With the government introducing the number of new sort of taxes and levies to pay for all of their additional, sort of incentives, like new new nuclear, new carbon capture, etcetera, etcetera. With them introducing them, we think it would be quite an easy path for them to follow, to mirror what they've done already, aka get an EII certificate because when they roll out all these other things, you're more than likely gonna have to have that to take advantage of the exemptions or the compensation to come alongside that. Yeah. It's it's it's interesting if you think about it from a procedural process point of view as far as the government's concerned. If they can have one process to check eligibility, any new scheme they roll out, they can roll out a lot quicker rather than having multiple different claim processes. And, actually, network conversation scheme, the the net network charges, just to touch on what Dean was saying, network charges are essentially a cost, that's charged for getting the the electricity or the energy to your site. So the further away you are from a major network, hub, the larger network charges are. So your network charges aren't necessarily if you use a lot of energy, it doesn't necessarily mean you have really, really high network charges. However, equally, you could be using quite not that much electricity, but actual network charges could be really, really high. So as Dean says, it's it's worthwhile looking to get some EII exemption certificate because that opens the door to, other potential opportunities, network charges being one that exists today. But there's there's two or three other schemes. There's two I'm sorry. There's two or three other new taxes expected to be added to bills in the next two years. There's certainly a nuclear tax expected to come in. And my view is that I think from a government point of view, con continually adding to taxes at some stage is gonna have a real impact for them because, you know, there's a need to reduce costs as well. I think one one lead that they may have is to say, well, look. We're gonna add all these taxes across the board, but actually you guys here, energy intensive industries or industries we absolutely categorically want to support. If we are going to have growth in The UK, we need engineering, we need manufacturing. If we're gonna support these organizations, one one lever we have that we can pull fairly quickly is to say, well, here, you've got this this lovely piece of, work whereby we've added these taxis, but also we pulled this lever and we're giving you guys support. So, actually, you guys don't need to pay it. And we can do it really, really quickly. If you already hold an EII certificate, you kinda get the key to the to the golden golden, essentially, get the golden ticket, and you're able to kind of get the exemption straight away from those other products. So it's a real key point. So when it comes to EIA exemption then, Dean, from your point of view, what what what kind of industries or businesses do you typically find, unlikely to be eligible for the scheme, or at least what kind of industries and sectors and maybe activities do you think should absolutely be looking to see whether they're eligible or at least reviewing this? I suppose a really high level, anyone working with metal, anyone working with chemicals, anyone working within the sort of paper and packaging sector, plastic packaging as well would be very good. So, you know, it's it's quite it's quite broad. You know, where what's the the hardest hurdle here on the on the frame that there's only about 330 companies in The UK currently claiming an EII exemption. So it's a pretty darn exclusive club to be part of. Right? The the mean barrier of entry is determining if you're intensive enough against your financial metrics. So lots of companies are doing the right things where the typical pitfall is is actually overcoming the intensity test. We call it the 20% test. And that's where we need to take some of the financials of the business, like EBITDA, wages, etcetera, and we need to showcase that 20% of your, what they call gross value add is is equates to your energy cost, your electricity cost. So apologies for that, too much info there. But, essentially, that's the main barrier to entry. Now why over the last couple of years have things enabled more businesses to take advantage? Well, every year in April, which just happened, the calculation changes slightly. So some of the numbers we use in the background to calculate change slightly. And over the last couple of years, those numbers have been more favorable than they ever have. So a lot of companies might have heard of that, you know, three, four, five years ago, looked at it, never qualified, but now that the numbers in the background are more favorable, and that's simply due to high energy costs, it may be the case that they can now meet that 20% test. Okay. And I think I'm I'm also right in in in saying that the earlier area to look at is businesses who may look at sectors or industries and go, well, I'm not in that sector. I'm not in that industry. But the the eligibility is based on what they do, isn't it, rather than necessarily the sector they're in. So as long as you're carrying out one of the activities that's eligible. So that's the one thing we would always say to businesses. It is an exclusive club, but we we're literally constantly talking to businesses who who are eligible and may have either tried before and and not been successful or not quite understood it. I go, well, actually, I'm I'm not a energy intensive industry or I'm not a manufacturer, therefore, I'm not eligible. And, actually, what we're saying is, depends what you do, depends what your activity is. You may well find there's one piece of activity in in your process, that is eligible. So I think, from an eligibility I'm just gonna say it. Yeah. Go. Sorry, Zachary. That's alright. It's just one one of the most common pitfalls is a is a find that companies will look at the list of eligible for the manufacturing sectors, and they'll look at something like their company's house and say our set code is not on the list. And that's because the ZIP code maybe isn't the true reflection of what activity is happening within the business. You know, that ZIP code, a lot of the time, is actually put there by an accounting to created the legal entity years and years ago. So a lot of companies rule themselves out straight away, but it's more about, you know, pulling apart what what does that company do from start to finish. Is there eligible manufacturing activity happening along that journey? And sometimes what we'll find is, you know, there's a a pocket of eligible manufacturing right bang in the middle. So it's not at the start. It's not at the end. It's not the end product that's all over their website and is what they sell as such. It's the middle part that's eligible. And what we can then do is get an exemption from the energy consumed in that middle part. That's where you would then get a, say, a thirty, forty, 50 percent exemption certificate. Dean McKay regularly surprises me by coming to me with clients who I look at and go, why why would they be eligible? Because you take one look at them as an organization and go, well, they're clearly not gonna be eligible. And, actually, Dean says what he's done is he's pulled apart their entire processing goal. But this part here is this part right in the middle of what they're doing, Dean. And that always surprises me by coming to me with clients that I genuinely didn't expect or or would not have thought of as to say, actually, these guys are really deep. They clearly can't claim this. So that's why I think when I said at the start, one of the key things for me, one probably takeaway if I was giving advice to any, certainly engineering business, I would be saying is just get a review. Just every year, once a year, do review of what you do. Do review of the criteria. Do a review of your numbers. And then worst case scenario, look, you're not gonna be eligible for an exemption, but you can sleep easy now, and you've done everything you can to reduce that bill. That's my advice to any business. It's just on a yearly basis, review it. Have a look at it. And, you know, let's see let's see whether there's an opportunity there. If there isn't, there isn't. But if there is, you could be looking at significant opportunity to to reduce your energy bill, not just by the exemption itself, but by all of the other opportunities that, you know, are linked to this exemption. So that value could really, really increase and, you know, goes back to what we both myself and John both said at the start is cost of energy is certainly not not going any it's not gonna be reducing massively anytime soon, so it's gonna be a big factor for you. Okay. So AI exemption. So, how does it how does it work then, Dean, in terms of what what actually physically happens then for that? How do they get the benefit? What is the benefit? Well, basically, we we would need to determine eligibility. We would then call in a a what we just call an EII submission into the department for business and trade, and there's quite a small team within DBT that we're familiar with that that manage all of these exemptions. And it can take a wee while, you know, from the submission goes in. We've been promised, you know, a turnaround time, I think, of about eight weeks. Sometimes it's longer. Sometimes it's quicker, though, I suppose. But, once that's in and once it's approved, you know, and the government's approved it, you will get a certificate. That certificate is invalid for five years as long as it's maintained, and there's a bit of quarterly and then annual admin required to maintain it for that five years. Once you have the certificate, you don't need to prove your eligibility again. You need to just maintain it, you know, through that that sort of admin again. We do that here, typically. That's that certificate goes off to the supplier, and the supplier should zero those line items on your bill. What's it worth? An EII exemption is typically worth around a reduction of about five p per kilowatt hour. So depending on how good your deal is, that can be a a pretty hefty chunk of the the overall bill, and that's not even including the the network charges compensation on top of it. That's and and I mean, five people and, again, it's really interesting. I I often talk to, my background being energy more energy consultancy around the fuel. I think it kilowatt hours a significant value. It really is significant value of your bill. And, as Dean McKay says, not including the other side too. The other challenge for for any business, though, just to be aware in terms of challenges and some of the things that are difficult with this would be, the certificate then allows your energy supplier to reduce their cost. But I've worked I've worked for two energy suppliers. I've been in the industry fifteen years. I I always I've always been a I believe that the energy supply industry is from a service point of view, not one of the best we have. It was something we shouldn't be particularly proud of. We've not necessarily invested in in a great deal when it comes to energy suppliers. That is one of the challenging parts of it is a first step is get your certificate. Second step is get your supplier to then amend your bill so you're getting those exemptions. That's a really tricky part. Not not particularly easy thing to do, but, you know, again, it's something that, we do have a late, and we really push suppliers to do it. There's a lot of talk in the in the industry trying to get supply to be better at that, but it it is one of the challenges. The admin, I I I have to be honest with this. The admin is one of the hardest parts of this whole scheme. Working with the Department of Business Trade, I don't work with them for suppliers, but, you know, the benefits are huge. So great. So I said we'll talk about two different products, so let's look at product number two. So, The UK ETS compensation scheme. So, slightly different scheme, has similarities, slightly different. So, Dean, how would you what would you say is the difference between The UK ETS compensation scheme and the EII exemption scheme? Well, the the first one is that it's the compensation. So you're getting paid cash. You know? So rather than reducing the bill, you're being paid cash. What's that cash actually for? It's to reduce the indirect impact of The UK's emissions trading scheme. So, basically, what what the government are saying is because of the the existence of The UK's emissions trading scheme, there's a indirect impact on electricity prices, AKA, it's a bit higher. So what they'll do, if you're in the right sectors and, again, if you meet the right sort of intensities and it's a different test, but if you meet the right intensities, you will get, basically, a letter that says for the next twelve months, you've been awarded x amount of compensation, and we'll pay it over these four quarters. So it's a some businesses prefer that, you know, because you can spend whatever they want. But, it's a cash payment, and that that's really the the main difference. Eligibility, the test is slightly different. I would say that it the way the test works is on paper, it's harder to meet that intensity test. However, the e ETS compensation scheme has, less direct guidelines about the financials that are included. There's rules that allow us to, you know, just ring fence, for example, part of your manufacturing process. So rather than take the financials for the whole company, we could just ring fence the eligible part and apply using those numbers instead. So it can be easier to meet it if, you know, if we look at it from that angle. I think, I I always find the compensation scheme seems to be more popular with clients, and I think that's because of that cash payment was always psychologically I think always receiving cash feels better than having a discount off something. The reality is I think there's probably more value in the exemption scheme than the compensation scheme, but interestingly enough, I think there's that psychological piece of getting that transfer. I think maybe to give you a bit of overview of, why the scheme exists really similar to to actually EIA exemption in terms of it's a lever for the government to, support businesses in reducing their energy of, and to cover the the indirect costs. But, one reason the scheme does exist is to actually say to businesses or, actually, one other thing you can do is reduce your energy costs. So, the best way the two things you should be looking at as a business who's got high energy costs is, one, using less energy, or two, generating your own energy. We we won't talk about that today, but, although, that is something they do, support businesses with. But if we look at reducing your energy, as I say, through taxation, this is one of them. It's a really good opportunity to do that. But what this scheme is set up to do is to help support businesses by offering compensation, which can then maybe be fed back into the business to support, energy reduction, technology or schemes or ways of working. I always believe that rather than take advantage this is a great scheme to take advantage of the the data you need to collect to be eligible. You need to collect a lot of data on your organization. You need to understand how your organization works. You need to understand how your processes work, to be able to see whether you're eligible for it. Take advantage of that process by actually giving you an opportunity to review that process, review your financials, and think to yourself. Actually, are there any other ways I could reduce energy rather than just taxation? Because, you know, this is a good opportunity to review all of that. And so, actually, we've got a compensation here scheme here, but, actually, we could invest that compensation scheme into our business, and look at maybe some energy reduction technology, which which might actually help us even further in the long run. So it's a it's an interesting scheme. As Dean says, it offers conversation rather than exemption. So I talked earlier about how sometimes one of the challenges with EIA exemption is getting the energy supply to do what they should do, which is reduce your bill. Actually, this isn't the case. This is a direct payment from the government. So, essentially, if you're eligible, the government will pay you a compensation amount quarterly. You will get a twelve month letter that says every quarter, we will pay you this money, and you get that money. And then every twelve months, you have to do an annual return, to look at the next year's value, and then that will be paid to you, obviously, based on your consumption and stuff like that. So it's a I I find this scheme a tiny bit more straightforward in terms of understanding, than than the exemption scheme. Other thing that Dean touched on there that I I would have to say is really, really important is I've worked in energy for a long time. For three years, I've been at late and particularly focusing on the taxation side of energy. One really interesting thing is the working with any of these government schemes is you you understand very early on is there is no actual clarity in the guidelines. The guidelines will quite often be fairly vague. One thing to understand is, challenging those guidelines and really understanding what the meaning is around them is something that we do a lot of. And because we have the experience of working with lots of different businesses, it gives us the opportunity to to understand, actually, this works and this doesn't work. One thing, again, I'd say to any business is never take the guidance, literally, when it comes to any government guidance because it it tends to be fairly fairly ambiguous, and can be read in a number of different ways. Right now, all the time, we're constantly coming across lines within the guidance that we we clarify. We often we've we've had quite a lot of the guidance amended due to our actions when we've we've challenged DBT on it, and they've been actually, yeah, that's not quite clear. So the other thing I would say to any business is don't necessarily think you're ineligible, but always will be ineligible. I think it's a matter of it it's an absolute moving part, so make sure you're regularly checking whether or not that eligibility change might seem better. It might work in your favor. So from the on The UK ETS scheme, what would you say so, again, what what are the what are the benefits of it in terms of a or what kind of what kind of financial benefit could you look at? Is it the same as the exemption in terms of a a pence per kilowatt hour? What kind of savings or or compensation can businesses potentially get from this scheme? As as a sort of general guide, I would say it's a it's around 2p per kilowatt hour would be the rate of compensation you'd receive. So it is a bit less than the the EII exemption. Again, what's quite good is both of these can run-in tandem. So you can have both of them to team them up, and you've got 70 discount essentially. But, you know, there are scenarios sometimes where the financials of the company sit in the right space where they actually get paid a lot more than that. Some sectors, some manufacturing activity has been deemed up as having more risk of carbon leakage because, again, this is what all of these incentives are about, keeping the engineering or the manufacturing in The UK. So some activity has been deemed as more at risk, and they've actually got a higher rate of relief automatically assigned to it. So, again, there's there's quite a lot of nuances to determine if you would get that higher rate of relief, but when you do, it can play, you know, real major dividends. I've I've seen companies get, you know, compensated, and it's covered, you know, more than half of their annual bill, for example. Yeah. It's it just goes back to to what we were saying before. Just think of it from the, the point of view of of why these schemes are in place. There are levers to be pulled to support industries. And and right now, particularly from, where where we're at is is is the push to incentivize growth. This is a really easy way for the government to go. Actually, we can really financially support industries and sectors that we want to. We can do that very, very easily through these schemes that already exist, without having to necessarily, you know, create something new or go through a whole new process. And that that's one of my personal opinion would be. I think over the next two to three years, you will find that schemes such as this will be extended rather than a whole new way of working. They'll be extended because they they work. They're quite smart. The process is in place already. So I I would again strongly suggest that businesses are thinking about that they take advantage of this because it's it's it's a really good team. And the compensation scheme generally is is, as I say, it's kind of a bit more straightforward because you don't have that challenge of and then you just spiral the end of it. You you receive direct payment from the government, which is which is great. And let's be fair. There's not a great deal of schemes out there where you receive direct payment from the government. So let's let's celebrate when they do exist, and take advantage when we can. Very briefly, I'm gonna touch on, one or two other things that exist. As I said, there are two main ones I think will work for you guys. There are other schemes. There's the climate change levy scheme, where you can get reduction on your climate change levy, which goes into your bill. You can either do that directly or via a climate change agreement. So there's there's schemes there. So, again, worth looking at, worth understanding. And I think outside of that, it's worth noting that there's probably two or three potential new schemes that are due to be added. I touched earlier on, a nuclear tax that I believe is likely to hit in the next two years or so. I think there's a move towards more nuclear power being generated in The UK. Great way of doing this or funding it, essentially, is via taxation of energy bills. Again, like I said before, my firm belief will be it will get added, and there will be exemptions and compensations available for businesses, certainly in the engineering sector, to be able to take advantage of actually reducing those. But, like, in the first instance, it's gonna come on your bill. In the first instance, it's gonna hit you. And those those extended costs are gonna be really, really challenging for businesses. So, worth keeping in keeping those, in mind. I suppose one question I've got maybe, Dean McKay, that you you could maybe answer is regarding the ETS and EII exemption schemes. What what common misconceptions do you do you find when speaking to businesses about these, that you could, you know, you can maybe address? Yeah. It's some of the stuff we've already touched on, I suppose. The main one being, I I believe that because their SEC code doesn't marry up with some of the the SEC codes that are on the the guidance, that they are not eligible. You know? And it's not really about what your SEC code is in company's house. It's about what manufacturing activity you're doing. So I would I would look at it from that angle rather than just sort of on paper company's house side. The second one is that the because they they say, you know, energy intensive industries, etcetera, the businesses automatically deem themselves not intensive enough without actually crunching the numbers and determining that. You know, that there's a really, really big downfall. You know, a lot of lot of businesses, what they look at is how much they're spending. And what we're actually looking for is how many kilowatt hours they're consuming and using that number against some of their financial metrics, which spits it out. Because it's not really about how much you spend. It's about how much you consume. And and that's, I suppose, is a is a key too that I see time and time again. Just an automatic sort of a look at the guidance at very high level and the determination. Alright. We don't qualify, or that's not for us. You know? And that's what a lot of time, that's the the sort of people I'm speaking to and then showcasing, right, this is where you have eligibility. This is how we meet that intensity test. Okay. I mean, from from my point of view, what I would say is, energy costs are high. They're a big impact in the business, particularly engineering, but just actually any business across The UK. Energy prices are a big chunk of what you do. And I think sometimes there's a feeling it can't be controlled. I think that feeling certainly over the last four or five years, when I speak to clients, there's a feeling of what can we do, energy prices of spite, and we're we're kind of we can't do anything about that. Well, the truth is you you can't do anything about spiking commodity costs. You can't. Yeah, can't rising conflicts in in Ukraine and and between Ukraine and Russia. Well, there is nothing that we can control, but we can control the non commodity side. There is some control there. And I suppose what I would say to businesses is try and control. You can focus on the bits you can and make sure that you are as prepared as possible if we do see a con a rising energy prices again. As I mentioned before, the factors that made energy prices rise, they may not be headline news as they were, but they they they haven't gone anywhere. They still exist. Those problems are still there, and they could spike again. If they do, make sure you're prepared as prepared as you can be. You can't control that. You can control monthly cost to an extent. So you can make sure that you are not paying a penny more than you should do. And if there are exemptions out there, you're taking advantage of those exemptions. I think then on top of that, there's also an argument to say, generally, within energy, take the time and maybe, regularly be looking at your entire business from start start to finish. Where is your energy being consumed? How is it being consumed? And are we being as effective and as efficient as possible? That's a piece of work that can be done. It's not overly complicated, and you could find that the the savings are there or there are savings there. But even if they're not, you're sat there going, well, actually, I've done that piece of work, and I'm really sure that it's as well as I can be, we're as efficient as we can be. It's gonna be difficult for any organization to be absolutely perfectly efficient. But, look, if there's if there's ways to improve efficiency. And my other point would probably do it all in one go because a lot of the time, what you'll end up doing for a scheme like this, you'll be collecting loads of data to parts of your business to make a claim. Actually, that data could have helped you put together a bigger plan. So my my suggestion for businesses categorically would be, on a yearly basis, make sure you are reviewing the non commodity costs within your energy bill. Every single year, review it. You may be eligible, you may not, but you've reviewed it. And I think it should be a piece of work everyone does, and it's not overly complicated, once you know how you're doing it. And, of course, we can always help with that later as well. So, I think from from my point of view, that's I think that we've covered the areas we wanted to today. I don't know, Nadine, have you got anything else you wanted to add, that you think we've not covered? Well, just to touch on when you you mentioned there about reviewing review on an annual basis. The schemes are updated every April. So if you don't qualify, once April rolls around again, usually it takes the government a couple of weeks to put it out officially, but that's when they will have upgraded the sort of numbers in the background for these intensity tests that you need to meet. So we April is actually a good time to look at it, you know, and just maybe just stick that sort of in the diary. Yeah. And I think so so I think, John asked a question around key eligibility, on the for EII certificate. I looked at it probably a bit more straightforward. I I less in the detail, but there's literally there's two parts to it. One's a financial test, and one's a, what you do. So I what I always say to clients is the key criteria is it is first to look at is what do you do. Do you do one of the activities that's eligible? And I think Dean's mentioned a couple of times, and he's absolutely right. Don't think set SIC code. Don't think sector. Don't think industry. Nice guide. If you're in these sectors, you definitely should be looking into our own metrics of metals and chemicals and packaging before. Absolutely categorically. If you are in those sectors, absolutely be looking at this. But, actually, even if you're not, it's worth understanding the activities. So it's an activity based eligibility criteria, not necessarily your sector or industry or. I mean, what we've definitely found is we found businesses. So as I said, I when I say we, it's the royal way. Dean McKay the best guy doing this rather than myself. But, I said before, Dean McKay come to me before with all sorts of weird and wonderful businesses that, you would not have thought at all would be eligible, but actually were eligible because of these activities here. So first of all, activities. Second is the financial test which Dean McKay touched them on before, which we hold the 20% test, which is all around, actually, how intensive you are. So they're the two main criteria. Dean McKay, would you would you add anything there? No. I I think that's pretty, you know, that's pretty much it. You know, we we want to understand from start to finish manufacturing. Once we then pinpointed eligibility within that, that's when we can then look at, like, let's crunch the numbers and determine can we meet that path. Yeah. Fantastic. And also worth noting, and I won't this isn't something I don't be going to detail on. I mentioned before around the criteria. There are weird and wonderful things we can you can do within the those financial tests. There are bits you can leave out, bits you can add. All of this is in the guidance, but it's it's detailed in in lots of different ways. So you can pick and sometimes pick and choose the data you use to come to that number. So, again, don't, we we've had clients in the past who've been really clear we're not eligible because of financial point of view. When we've run the numbers, we have found they are eligible because there's different ways of going about it. So keep that in mind as well. I don't we we haven't got any other questions at the moment here. I don't know if anyone else has a question to ask. Oh, Sarah, I can't I can't quite I don't know if you're on mute, Sarah. Sorry. Yeah. We do have a couple of questions in the q and a box. So, Liz Liz Mosman sorry. Lisa Mosman wants to know, is there a link to the applications, and is this something that Leyton can support with? Alright. Dean Dean, do you wanna answer that? Yeah. Well, yes. You know, so the latent, that's about me and Zach and not, you know, the team of consultants that sit behind us spend all our time doing. So we can definitely support you with that. The applications, there's, I suppose we can try and find the the websites. But if you if you were to Google, that's probably the easiest to look for the gov website. Sometimes it's not the easiest thing to find. But, yeah, you can definitely get find links to applications, but, you know, Leyton can support you as well and help you navigate it. I would say, Lisa, the the main thing that Leyton can support you with, there's three key areas. One is making sure we you've done you are eligible and taking our knowledge and expertise that we've done this so many times that we we get it. But outside of that is, first of all, is getting your certificate. We haven't really touched on it. The problem of business and trade, when you make your application, they're the people who review it. They can be very, very detailed. They can come back with multiple questions. Some cases, they don't. Some cases, they do. Some cases, they'll come back with huge amount of questions. You imagine extra data they'll require. In some cases, it may be fairly quick. In some cases, it may be fairly slow. It's worth saying, as a government department, they have had challenges over the last twelve, eighteen months, particularly around resource, which is great that they're now cleared up now. We're finding, they're a lot better, but that relationship, we can help with by just managing that process. I touched on it before with the EIA exemption is, certainly, it would be dealing with your energy supplier because anyone who's ever had to pick up the phone to an energy supplier, will know that's not fun. Thankfully, not something I do that much these days, but I we have a team of people who do do it, and I wouldn't I wouldn't miss that upon anyone. So we help with that as well. So, yeah, yes, we can help. I think, Stuart, you've asked, can you qualify for both the EI and ETS schemes? It was in either or publication. So for an answer, yes, you can. Absolutely, categorically. And we have multiple clients who are eligible for both. The criteria is is literally separate, so they're seeing the separate things. It's the same, organization who reviews it, though. So, again, department of business and trade at the organization in question. So it's the same people who review them. Catabolic, you can apply for both. So, yes, that says it's fairly straightforward one. What would the cost for for for us if you're late and assist with the application? It's probably your your area, Dean. Do you wanna Yep. Do you wanna We work we work on a we work on a contingency fee basis, so it'd be a a percentage of the the benefit you receive. And so a lot a lot of this work we do is upfront making sure that there is going to be a benefit for both for both parties. But the sort of fee percentage would be dictated by the the opportunity size. So it's not a one size fits all, but it is very much a a a percentage of the benefit you would receive. The the one of the reasons we do that is it goes back to the eligibility again. From our point of view is, we we wouldn't wanna be charging you for us to check the eligibility and insurance eligible as far as we're concerned. You will only really pay. Obviously, eligibility is confirmed, and you received some benefit. So, it's kind of a benefit based system. You think about the compensation scheme, the way our schemes tend to work is we'll take a percentage of that, but we'll actually only take it even then after you've received the payment from the government. So the government will pay you, and then we will we will, invoice you a percentage of that. So, again, from your point of view, it's a nice scheme. Actually, it works really well for us as well, but it it's a nice scheme for you in terms of that that opportunity to get involved in these things. So, and, certainly, we're more than happy to sort of clients and have that conversation with anyone and give advice on it. So feel free to give us a call, book a meeting, or do whatever you need to do to to have a chat with it, and we're we're happy to to have that review. Dean's always happy to chat to clients, so, feel free to reach out to Dean or or any of the team. I'm sure the rest of the team would like to sort you as well, but, in particular, Dean. We got any any other questions coming through? I don't think we have at the moment. Have you, Sarah? No? Good. Well, I suppose from from my point of view, first of all, thanks, Dean. I appreciate your time in in in taking us through that. I think from my point of view, final piece would be, a call to action for anyone. If you're not sure, just pick up the phone to us, and we'll we'll we'll help take you through it. And, worst case scenario, you you can sit back and go, well, we're not eligible, but we definitely looked at it. Best case scenario, there could be some some real financial benefit you're sat waiting for that, could be out there right now. So, maybe maybe think along that. I don't know. John, do you have any anything you wanna add before before we finish? I just wanna thank you all for, for taking the time to come on and explain these points in the process. I I just replied to another point you made. I have heard member companies saying, yeah, you know, we none of these schemes would apply to us. We're not energy intensive. We're not a steelworks. We're not a chemical processing plant. And I think the key lesson that I heard today was, energy costs have increased dramatically as a percentage of of of your of your profit margins, turnovers, whatever. The the rules themselves change, and it it makes a hell of a lot of sense to check-in regularly, you know, because and the set codes as well. It makes a lot of sense to go beyond these high level perceptions of who who's eligible and who isn't and to check out, you you know, as a company or with with the support of yourself. So, I think that's that's great advice for all companies, in the sector. Fantastic. Good. Well, thanks everybody who's attended. I hope you've you've taken something away from it, and you you've kind of enjoyed the session. Appreciate your time, Dean, and and thanks for for inviting us, John. So, we will we will end the session end the session there. Thank you. Thank you. Thanks, everyone. Thank you.