ALFED Submits BICS Consultation Response on Behalf of the UK Aluminium Sector

The Aluminium Federation (ALFED) has now submitted its formal response to the Government’s British Industrial Competitiveness Scheme (BICS) consultation, following extensive engagement with members during our recent roundtable webinar delivered in partnership with Leyton. The consultation is a significant opportunity for the aluminium industry to ensure that the scheme reflects the realities of how our sector operates and that energy-intensive businesses across the value chain receive meaningful support.

During the roundtable, members shared detailed insights into gaps within the Government’s proposed eligibility framework and highlighted several areas where the draft scheme does not yet capture the full spectrum of energy-intensive aluminium activities. Contributors from across the sector, including recyclers, service-based manufacturers, melters, fabricators and specialist processors, emphasised that BICS must be broadened if it is to deliver equitable and effective support.

A recurring theme throughout the discussion was that the current SIC/HS code lists omit several essential, electricity-intensive activities that sit between primary production and final product manufacturing. These include polishing, anodising, coating, cutting, bending, forging, casting and other mid-stream processes. Members also underlined the critical role of scrap processors and secondary preparation activities, both of which contribute directly to the UK’s ambitions for circularity but appear inadequately represented in the codes proposed to date.

Concerns were also raised about the business-level electricity intensity test. Many members noted that methodologies similar to those used in the EII scheme produce distorted outcomes for metals producers, particularly where raw material costs dominate expenditure or where mixed-fuel sites rely heavily on gas because grid capacity for electrification is limited. Businesses consistently reported that the proposed April 2027 implementation date is far too late and urged ALFED to push for earlier support or backdating. Members also expressed concerns about the administrative burden on both businesses and DBT if thousands of applications must be processed within a short timeframe.

ALFED has taken these issues forward in its own consultation response and will continue engaging with DBT as the scheme is refined. We strongly encourage members to submit their own responses before the deadline of 19 January 2026. Individual submissions are vital: the consistency of messaging across the sector will materially influence Government’s final decisions.

Recommended Points for ALFED Members to Include in Individual Consultation Responses

To help ensure a unified and influential sector voice, ALFED encourages members to reflect the following themes, adapted to your own operations, when preparing your submission:

1. Highlight whether the SIC/HS codes capture your activities

If your business conducts polishing, anodising, coating, cutting, bending, forging, casting, fabrication, scrap sorting or secondary preparation, consider explaining:

• Why these activities are energy-intensive
• How they contribute to the aluminium supply chain or circular economy
• Why their exclusion would undermine the intent of BICS
• Which codes are missing or require revision

Multiple members in the roundtable emphasised that their processes are “manufacturing services” that do not produce a finished product but are nonetheless essential to aluminium production.

2. Explain how the business-level electricity intensity test affects you

You may wish to describe:

• Whether raw material costs distort electricity intensity for your business
• Whether you operate mixed gas–electricity processes and how this affects calculations
• The impact of the existing 20% EII threshold and whether a lower threshold (e.g., 15%) would be more appropriate
• The challenges created when intensity percentages fluctuate just below eligibility levels (e.g., 17–19%)

Members repeatedly stressed that the test must not replicate the restrictive features of the EII scheme.

3. Emphasise the importance of recognising recyclers and scrap processors

If your organisation handles scrap, secondary materials or recycling processes, consider emphasising:

• Your role in enabling UK circularity and reducing scrap export
• The electricity demands of sorting, baling, cutting and preparing material for remelting
• The need for these activities to be clearly captured in the eligibility framework
• How excluding recyclers would undermine the UK’s industrial and decarbonisation objectives

Members across the recycling segment were particularly clear that inclusion is essential.

4. Comment on the proposed April 2027 implementation date

Explain the current pressures your business faces regarding electricity affordability. You may wish to state:

• Why support is urgently needed before 2027
• Why Government should accelerate the scheme or explore backdated eligibility
• How delays could affect investment, competitiveness or ability to electrify processes

Every member who spoke on timing considered the current start date too late.

5. Raise concerns about administrative complexity

You may want to highlight:

• Whether separating electricity consumption by product or activity is feasible for your site
• Any reliance on shared meters or integrated process lines
• The need for clear, simple, well-resourced application processes
• Risks associated with DBT and suppliers handling large volumes of applications at launch

Members expressed strong concerns about meter-level attribution and the administrative burden.

6. Support a proportionate and practical business-level test

You may wish to echo ALFED’s position that:

• Expenditure calculations should exclude raw material costs
• Output-based measures (e.g., tonnes processed) are preferable to revenue-based ones
• The intensity test should accommodate mixed-fuel or partially electrified sites
• Trigger thresholds should support, rather than restrict, access to the scheme

7. Encourage Government to provide additional clarity where needed

Members identified several ambiguities in the consultation, such as:

• What costs count toward total expenditure
• How activity-level pro-rating would work
• What evidence will be required to demonstrate eligibility
• How the scheme will be administered and reviewed

Requesting clarification strengthens the case for practical, workable policy design.

Next Steps

ALFED will continue to engage with DBT over the coming months and will keep members informed of developments. The draft of ALFED’s full consultation response will be shared with members in early January to support consistency and provide a template for individual submissions.

If you need help interpreting the consultation questions or wish to discuss how BICS may apply to your operations, please contact the ALFED team directly.