UK chemicals industry urges government to address rising energy costs

London – The UK’s Chemical Industries Association (CIA) has called on the government to tackle the “huge problem” of rising energy costs as part of its measures to support the economy.

In a release following the delivery of the spring statement by chancellor Rishi Sunak, the association said it welcomed some measures such as commitment to create conditions for economic growth, reform of R&D tax reliefs and increase to the employment allowance.

However, it added, “a huge problem was not tackled or mentioned by government - support for business on energy costs.”

"We urgently await the delayed ‘energy security plan’ that the chancellor referred to,” said CIA chief executive Steve Eliott.

The strategy, which will significantly involve renewable and nuclear energy, aims to secure the UK’s energy supplies and dampen the rising costs for consumers and industry.

Eliott also called on the government to confirm the “long-promised” future compensation scheme for energy-intensive businesses, which are faced with significant indirect carbon costs.

The existing scheme, Eliott reminded, is set to close shortly, “leaving huge uncertainty for our companies having to compete globally, including EU competitors now benefiting from increased support from the commission."

According to CIA, the chemical industry supports 96% of all manufactured goods across the UK.

Most businesses are located throughout the UK, with many of them clustered together in the northeast of England, northwest of England and central Scotland.

The spring statement is an annual statement made by the chancellor of the exchequer and provides an update on the overall health of the economy.