How to apportion your energy usage for BICS

If your site makes only eligible products, working out your British Industrial Competitiveness Scheme (BICS) exemption is simple. But many sites make a mix of eligible and ineligible products, and then the exemption depends on how much of your electricity supports the eligible work. That calculation is yours to make, and it defines how much relief you can actually receive.

What are the bands for BICS?

BICS sets your exemption by looking at the proportion of your grid electricity used for eligible manufacturing. The result puts you in one of three pro-rating tiers:

• 25% or less of electricity used for eligible manufacturing: 0% exemption
• More than 25% but less than 50%: 50% exemption
• 50% or more: 100% exemption

On-site generation, such as solar panels, is outside the scheme and is excluded from every figure. Only electricity drawn from the grid counts.

The same banded approach applies to supporting activities, which can be included when you are working out which band you fall into. Your total eligible activity in MWh (direct eligible manufacturing + the banded amount of supporting activities) will tell you how much of the exemption you can apply for.

The four steps to apportioning your energy usage

The method for apportioning follows the same sequence each time.

1. Total grid consumption. Take the total figure from your bills for the most recent six consecutive months, excluding on-site generation.
2. Eligible consumption. Add the electricity used on the production line for eligible products, plus the share of supporting activities that serve eligible production.
3. Proportion. Divide the eligible figure in step 2 by the total and multiply by 100.
4. Tier. Read your exemption from the tiers above.

Having your own meter is the easiest situation to be in, as all your data is exclusive to you. If you don’t have your own meter, you’ll need to demonstrate how much grid electricity is used by the MPANs in the most recent 6 months and the amount your site has consumed over the same period.

A worked example

In an example where a company has a single site which makes multiple products, only one of which qualifies, careful and accurate apportionment will decide how much relief can be claimed.

A site used 100,000 MWh of grid electricity between March and August 2026. The production line for an eligible product used 30,000 MWh, or 30%.

Supporting activities used a further 20,000 MWh, and 30% of that supported eligible production. Because that falls in the middle band, half of the 20,000 MWh, or 10,000 MWh, counts as eligible.

Eligible electricity is therefore 30,000 plus 10,000, which is 40,000 MWh, or 40% of the total. That falls in the middle tier, so the site receives a 50% exemption.

Our guide to supporting activities explains how that banding applies to things like compressed air, lighting and HVAC.

How do you estimate when you don't have sub-metering?

Plenty of sites don't have sub-meters, and that doesn't stop you applying. Where sub-metering exists, you must use it when working out your pro-rating level. For BICS purposes it includes more than traditional sub-meters. Energy management platforms, monitoring dashboards and machine-mounted sensors all count, provided they give you monthly totals.

Where you don't have any of these, you provide an estimate and the rationale behind it. The government guidance gives two examples of acceptable approaches:

• estimates of average electricity use by machine
• production data used as a proxy for electricity use

Underlying evidence isn't required at the point of application, but it may be requested in post-application checks. In practice, that means your estimate should be one you could defend. Keep the machine ratings, run-hours and production figures you used.

Writing the methodology statement

You'll explain your calculation in a free-text box limited to 350 words. A good statement does four things:

• states the six-month period used
• sets out each step, with the figures
• explains why you chose the method, such as machine run-hours or production volumes
• notes anything shared, such as a meter used by another tenant

Key takeaways

• Use grid electricity only. On-site generation is excluded from every figure.
• Use sub-metering where you have it. It must be used when determining your tier.
• Document any estimate. The rationale matters, and evidence may be requested later.
• Check which side of the thresholds you fall. A small change in the proportion can move you between tiers.

Careful apportionment can be the difference between a 50% and a 100% exemption, so it's worth getting right before you submit. If you'd like a second opinion on your calculation, contact the Energy Relief Vault team to discuss your site.

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