Climate Change Levy Explained

Climate change is a huge environmental challenge facing the world today. To contribute to it’s reduction the UK Government has introduced the Climate Change Levy (CCL), an energy tax which is applied to UK businesses who consume more than 12,000 kilowatt-hours (kWh) per year.

Its purpose is to encourage businesses to be more energy efficient in order to reduce greenhouse gas emissions. It is expected to cut annual carbon emissions by 2.5 million tonnes a year.

It was first introduced in April 2001 with a rate for electricity consumption of 0.43p/kWh. In April 2007 the rate was increased to 0.441p/kWh and in April 2008 to 0.456p/kWh on the amount of electricity used. The levy is collected by electricity suppliers and is paid directly to the Government - no extra cost is added by Opus Energy.

Climate Change Levy Exemptions

Some businesses may not have to pay Climate Change Levy (CCL):

• If your business consumes less than 12,000 kWh per year
• Domestic users and 5% VAT registered users (non-business charity users). However, electricity used for business purposes by registered charities will be charged CCL
• If your power is obtained from a renewable source or cleaner power produced by Combined Heat and Power generators, under the Combined Heat and Power Quality Assurance (CHPQA) programme
• Public transport services that are 0% VAT registered
• Intensive energy users are covered by an agreement negotiated with the Government and are decided on a case-by-case basis. Qualifying businesses will need to agree energy saving targets with the Government

To apply for CCL exemption, Opus Energy requires that you provide appropriate evidence or a completed PP11 certificate.

To find out more about electricity obtained from renewable sources or cleaner Combined Heat and Power, read our Environmental Commitment