The Association for Decentralised Energy (ADE) has said that an impending government review could increase energy costs in the UK by millions of pounds.

Estimations from the ADE state that the potential changes could increase the energy costs of industrial manufacturers by at least £170 million, reports theade.co.uk.

In fact, some of these manufacturers could even see their energy bill rise by almost £3 million annually.

Not only this, but independent analysis by Cornwall Energy found that encouraging local businesses to generate their own power actually lowers energy bills, as it reduces the requirement for investment in network infrastructure.

In the UK, hundreds of industrial manufacturers generate their own power onsite and use local electricity, as opposed to the national network.

As a result, these manufacturers have less costs to pay, which is known as the 'embedded benefit'.

However, it is the upcoming review by Ofgem into how diesel engine farms win their contracts that will cause a negative impact on all local generation.