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Climate Change Levy (CCL)

Your guide to CCL and what it means for you

What is the Climate Change Levy?

The CCL is a government-imposed environmental tax on commercial energy in the UK. It was introduced in the UK in April 2001 with the purpose of encouraging businesses to become increasingly energy efficient, reduce their CO2 emissions and the overall impact that they have on the release of greenhouse emissions; whilst in turn helping the UK to meet its emissions targets and assist in combatting climate change.

How is the CCL charged?

CCL is charged only on units/kWh used, not on any other component of the bill, such as any fixed daily charges.
There are separate rates for both electricity and gas. As these are indexed-linked they are likely to increase on April 1st each year.
With the recent decision to abolish the Carbon Reduction Commitment (CRC), the Government has put measures in place to offset the predicted loss in revenue. These measures include increasing the rates of CCL, this will take effect from April 1st 2019.

Who does the CCL apply to?

Since the Government’s announcement in the 2015 Summer Budget to remove the CCL exemption from renewably sourced energy supplied to businesses, all businesses who have renewable sourced energy contacts will now have the responsibility to pay the CCL.
However, the CCL only applies to businesses with an energy usage exceeding 33kWh per day for electricity or 145kWh per day for gas. Those below this threshold are exempt from the levy and are treated as domestic consumers.

 

 

Where can I find out more?

More information can be found on the government’s website: https://www.gov.uk/topic/business-tax/climate-change-levy