UK manufacturers have been hit by an electricity cost increase of 243% year-on-year, according to financial services provider BDO Stoy Hayward.

Electricity costs went up 23% quarter-on-quarter in the third period of the year, figures from the BDO Stoy Hayward Quarterly Manufacturing Electricity Tracker show.

BDO Stoy Hayward said this would have an acute impact on mid-tier manufacturers, who are unable to absorb these price hikes into their operations, unlike larger manufacturing operations.

“This is a staggering increase in a key element of the ‘fixed cost’ base of many manufacturers,” said Tim Lawton, head of manufacturing at BDO Stoy Hayward.

However, the figures also revealed that oil and gas prices are starting to come down, helping manufacturers control their energy outgoings. Oil prices were down 12% quarter-on-quarter, the first fall in 22 months, and gas prices falling 2% quarter-on-quarter.

“UK manufacturers are entering a very difficult period and should establish close management of key costs, including energy costs, to ensure that all steps possible are taken to minimise costs and cost increases,” said Mr Lawton.

“The recent financial turmoil might have one beneficial effect in the overall reduction of energy prices – but there is still a lot to be gained by active and involved management.”