Tackling Climate Change - Climate Change Levy

The Climate Change Levy (CCL) was introduced by the government in April 2001 to encourage both business and public sectors to improve their overall business energy usage as well as an attempt to reduce carbon emissions.

The CCL is an environmental energy tax that adds approximately 15% to a typical energy bill.

The CCL is taxable on ‘commodities' such as lighting, heating and power used by industrial commercial customers.

'Taxable commodities' include:

> Business electricity

> Natural gas (as supplied by a gas supplier)

> Petroleum and hydrocarbon gas in a liquid state

> Coal and lignite

> Coke and semi-coke of coal or lignite

> Petroleum coke

The levy does not apply to taxable commodities used by domestic consumers, or by charities for non-business use.

Are you exempt?

There are a number of reasons why you would be exempt from such a tax. These include being a charity, being a renewable energy user, or a company that have entered into agreements with the government to receive discounts in return for energy efficiency targets.

How is the Climate Change Levy calculated?

The levy has a separate rate for each category of taxable commodity, as is a follows:

> Electricity = £0.0043 per kilowatt hour

> Gas supplied by a gas utility or any gas supplied in a gaseous state that is of a kind supplied by a gas utility = £0.0015 per kilowatt hour

> Any petroleum gas, or other gaseous hydrocarbon supplied in a liquid state = £0.0096 per kilogram

> Any other taxable commodity = £0.0117 per kilogram

What do I need to do?

If you are in business and are making or intend to make taxable supplies, you need to contact HM Revenue & Customs and register for the Climate Change Levy.

Can I get a discount?

Customers in energy-intensive industries who have entered into Climate Change Levy agreements with the government can get an 80% reduction of their CCL.

To claim the 80% discount, you will be required to fill out a PP10/PP11 certification and send a copy of the certificates to HM Revenue & Customs and to your energy supplier before the discount can be arranged.

British Gas Business offer a range of products and services tailored to the business market, including fixed price energy contracts, boiler and central heating services, an online business insurance comparison service, and gas connections and metering service for new energy supplies, conversions and upgrades.

Customers can visit British Gas Business for further information.