Climate Change Levy (CCL)

About the Climate Change Levy

The Climate Change Levy (CCL) is a tax on the use of energy by business and the public sector.  It was introduced on 1st of April 2001 and is intended to encourage energy efficiency in business, reduce pollution and stimulate investment in new low carbon technology.

The CCL is the direct result of the legally binding commitment made by the UK Government at the 1997 Kyoto Conference to reduce greenhouse gas emissions by 5.2% below 1990 levels by the period 2008/2012.

The CCL affects most UK businesses, however there are some exceptions, but in the main will be charged to all businesses subject to VAT at 17.5%.  Some businesses may receive discounts on the levy, provided they achieve energy saving targets agreed between the government and their relevant trade unions.

CCL is applied at different rate depending on the energy source.  For Electricity it is applied at 0.470 p/kWh and gas at 0.164 p/kWh. (Figures effective 1st April 2009)

It is intended CCL will rise to 0.485p/kwh and 0.167p/kwh from 1st April 2011.

How is my business charged?

As your energy supplier, ScottishPower is responsible for collecting the CCL from your company and passing it directly on to HM Customs and Excise.  It is shown as a separate sub-total on your bill so that you can see exactly how much you are being charged.

How will the CCL be used?

The levy is intended to be fiscally neutral with all revenues collected recycled to business in two ways:

 Through reduction of 0.3% in Employers’ National Insurance contributions paid on employees’ earning in excess of £84 per week;
 By making £150 million available to provide additional support for energy efficiency initiatives

The Climate Change Levy (CCL) is a tax on the use of energy by business and the public sector.  It was introduced on 1st of April 2001 and is intended to encourage energy efficiency in business, reduce pollution and stimulate investment in new low carbon technology.

The CCL is the direct result of the legally binding commitment made by the UK Government at the 1997 Kyoto Conference to reduce greenhouse gas emissions by 5.2% below 1990 levels by the period 2008/2012.

The CCL affects most UK businesses, however there are some exceptions, but in the main will be charged to all businesses subject to VAT at 17.5%.  Some businesses may receive discounts on the levy, provided they achieve energy saving targets agreed between the government and their relevant trade unions.

CCL is applied at different rate depending on the energy source.  For Electricity it is applied at 0.470 p/kWh and gas at 0.164 p/kWh. (Figures effective 1st April 2009)

It is intended CCL will rise to 0.485p/kwh and 0.167p/kwh from 1st April 2011.

How is my business charged?

Your energy supplier is responsible for collecting the CCL from your company and passing it directly on to HM Customs and Excise.  It is shown as a separate sub-total on your bill so that you can see exactly how much you are being charged.

How will the CCL be used?

The levy is intended to be fiscally neutral with all revenues collected recycled to business in two ways:

1. Through reduction of 0.3% in Employers’ National Insurance contributions paid on employees’ earning in excess of £84 per week;
2. By making £150 million available to provide additional support for energy efficiency initiatives

9th August, 2010

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