STRUGGLING households could be hammered by a fresh hike in their energy bills as Labour reportedly plots to bail out failing factories.
Ministers are understood to be weighing up a new levy that would force families to subsidise the electricity costs of around 7,000 industrial plants.
The plans involve a massive £1billion support package designed to stop carmakers, chemical plants, and aircraft factories from moving overseas.
Under the proposals, a discount on network charges for these heavy industries would rise to 90% from 60% as part of Starmer’s industrial strategy.
While the move is designed to make UK industry more competitive, there are growing fears that the cost will be quietly offloaded onto ordinary bill-payers.
Industry insiders say there is a “working assumption” that the scheme — dubbed the British Industrial Competitiveness Scheme (BICS) — will be funded by a new levy passed directly on to consumers through their monthly bills, according to The Telegraph.
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That’s despite government promises that it would be paid for by cutting costs elsewhere in the energy system.
The timing of the potential plot is a fresh blow for families already reeling from the impact of the Iran war, which has sent global oil and gas prices soaring.
Analysts at Cornwall Insight say the average annual bill could jump by £160 to reach £1,801 when the next Ofgem price cap is set for July 1.
Energy bosses are said to be in a state of “deep frustration” after previously being reassured that the funding would be found from cutting costs elsewhere in the system.
Adam Berman, head of policy at Energy UK, which represents suppliers, said: “The Government has repeatedly offered assurances that the BICS scheme will not be funded through energy bills.
“There will be deep frustration in the sector if this is not the case, and that yet another levy is being added to energy bills pushing up costs for homes and businesses across the country.
“Support for energy intensive and trade exposed businesses with their energy bills is critical, but it can’t come at the expense of the rest of the economy.”
The Department for Energy Security and Net Zero was contacted for comment.