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Is your Business CCL (Climate Change Levy) aware?

My company recently conducted a survey asking random businesses about The CCL (Climate change levy). Firstly, did they know what it is and secondly where they aware that they were currently paying it?

A staggering 90% of the businesses we asked said no to both of these questions, which led us to think how many of you out there really know what your energy bill consists of? Let me explain; the climate change levy was introduced in April 2001 as a kind of carbon tax on non domestic energy users. The aim of the scheme is to provide an incentive for businesses to become more energy efficient. The more energy you use the higher the CCL, so if your business takes more energy efficiency measures you will reduce the amount of CCL you pay. This charge is applied to your energy bill and left for your supplier to collect directly.

Every business needs to know their numbers and with something like energy it’s crucial. More often than not businesses neglect their energy bills and tariffs, inadvertently costing themselves thousands, if not hundreds of thousands every year.

So how much is the CCL costing your business? As of April 2019 the price for Gas is 0.00339p/kWh which is an increase of 67 % since April 2018 and the price for electricity is 0.00847p/kWh an increase of 45% since April 18. There are exemptions for certain industries i.e. care homes and energy intensive users can get a 90% reduction but only if they agree to sign up to the climate change agreement.

Let’s look at an example; if your business is using 20,000kW per month of electricity and 5000 kW per month of Gas your total CCL each month will be £186.35, that’s £2236.20 a year on top of your energy bill! Of course this money isn’t used to line the energy supplier’s pockets it goes straight to the government. By making some simple changes around the office, warehouse or factory you could easily reduce this by 20% and if you really wanted to make a difference you could probably half the amount and as an even bigger bonus you’re going to significantly reduce the amount you pay to your energy supplier because you have reduced your consumption.

Businesses will play a huge part in the fight against Climate change and I for one believe they should be leading the way. By being energy conscious in the office staff will take that home and use what they have learned to improve their own carbon footprint which creates a network of people all working to save the planet one day at a time. So now you know about the CCL, what it’s for, how much it’s costing you and how to reduce it; I just hope it will encourage you to take a closer look at your businesses energy bills and make more conscientious decisions when using energy at the work place.

Phillip Hudson's picture

Thank Phillip for the Post!

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Matt Chester's picture
Matt Chester on Jul 5, 2019 3:33 pm GMT

Economic signals, such as through increased prices, are a critical tool to improving efficiency and reducing emissions-- so you're right that if businsesses aren't even aware of their costs or the CCL then it's a bit for naught. 

What are the mechanisms where such costs are typically communicated to them-- is it anywhere except on their bills?

Phillip Hudson's picture
Phillip Hudson on Jul 8, 2019 8:54 am GMT

Hi Matt, other than when it was launched in 2001 the CCL is not widely promoted to busniesses. When taking on a new customer my company always gives the customer a break down of their energy bill, this way the customer is aware what they are paying for when they get their invoice through off their energy supplier. 

I for one would like to see all energy suppliers send out a break down summary for every new business customer. You can break it down in 3 parts which equate to around 33% for each section of the bill; but within these three sections their are 9 different charges that make up the bill and the comodity itself is only 38% of the bill. It's important that businesses are being educated about the ever increasing costs of non-comodity charges to their energy tariffs. 

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