UK manufacturers warn of £85bn economic hit as high industrial electricity prices squeeze margins and threaten operative viability for one in ten factories

A report published by industry body Make UK, produced in partnership with energy supplier Ecotricity, warns that failure to reduce UK industrial electricity prices could cost the economy an estimated £85 billion annually, including around £50 billion across supply chains. The figure is based on Make UK's estimate that a 13% decline in UK manufacturing activity, which the report warns is plausible if energy costs continue to rise, would produce that economic loss. The report, titled *From Crisis to Stability: A Future Energy System for Manufacturers*, found that 90% of manufacturers said energy bills had increased at least moderately since 2022, with more than half identifying energy costs as their single biggest challenge over the coming years. Some 13% said further projected cost rises could threaten their operative viability. Seven in ten manufacturers are already passing higher costs on to consumers. Make UK identifies three structural causes: gas still sets the wholesale price of power too frequently; policy levies (charges imposed to fund national energy programmes) are loaded onto electricity bills rather than general taxation; and slow grid connections, ageing infrastructure, and post-Brexit energy trading inefficiencies add further cost. The report calls on government to deliver the British Industrial Competitiveness Scheme, shift electricity policy levies into general taxation, expand business rates relief for green investment, create a successor to the Industrial Energy Transformation Fund, and accelerate electricity market reform.