British companies are paying more for electricity than anywhere else in the world, according to new data.

The data compiled by the Financial Times shows that the average cost of a megawatt of energy per hour was more than $400 (£309) in 2023 – nearly twice as much as Germany which has the second highest cost.

The figure represents a 124% growth in the last five years which has seen Britain overtake many European rivals in the process to become the most expensive.

The UK and Germany were followed by Italy, France and Japan to complete the top 5 in the list.

As the government seeks to encourage businesses to operate out of Britain to help drive economic growth, the figures will come as a concern to business leaders given the increasing costs associated with operating from the country.

Frank Aaskov, the director of energy at lobby group UK Steel, told The Telegraph: “High industrial electricity prices have for too long damaged the competitiveness of UK steelmaking, and many in the wider manufacturing sector will be feeling the same pressure our steel companies do.

“The Government should tackle steep electricity costs and make the UK a fruitful place to invest, while enabling growth and improving competitiveness.”

In September, a report by UK Steel described the electricity price as “a barrier to growth, competitiveness and profitability”.

The figures also come as a blow to Labour’s hopes of incentivising businesses to move away from fossil fuels towards more environmentally friendly energy.

Secretary of State for Energy Ed Miliband has consistently stated that he would like businesses to move from gas to electrically powered processes.

But allowing them the means to do that has for years proven difficult.

Successive governments have attempted to bring down electricity costs, with the previous Conservative government introducing a “supercharger” discount for energy-intensive businesses such as steel producers and glass makers.

The “supercharger” allows businesses to bypass green levies and most network costs but still leaves them with a bigger bill than most European countries.

Britain has already seen the closure of steelworks in Port Talbot after Indian owner Tata closed their plants which they said were losing up to £1 million a day.

The closure cost around 2,800 people their jobs with Tata’s plans to reopen an electric furnace relying largely on Britain bringing the price of electricity down far enough to make it a realistic proposition.