Climate change agreement

The Climate Change Agreement (CCA) is a voluntary, UK government energy efficiency scheme.

 

Participants in the scheme receive a discount on the Climate Change Levy (CCL) charge to their energy bills in exchange for agreeing to work towards energy efficiency improvement and carbon dioxide (CO2) emission reduction targets – in certain industries the relief is can be up to 100%.

 

There are two types of CCA agreements. The first is an umbrella agreement, which is negotiated by the Department of Energy and Climate Change and industry sectors with an agreed target – aka the sector commitment.

 

The agreement itself is between the sector association and the Environment Agency (EA) who act as the administrator. The second type of CCA is an underlying agreement, one that is held by a site or group of sites and owned by an operator in a specific sector. These types of CCA contain carbon or energy efficiency targets relevant to their type of operation.

 

Who is eligible for CCA?

There are currently 53 business sectors participating in the CCA scheme and they range from aerospace to steel, and have been deemed to carry out an ‘eligible process’. You can check here to see if your sector is one of them.

 

The government guidelines for meeting the eligibility of a CCA and continuing to meet its obligations run some 170 pages long. Many of these also link to supporting appendices. This leads to a fair amount of reading that you need to pore over just to determine whether or not you are eligible.

 

If you do think you’re eligible for a CCA there are also a number of processes you HAVE to go through to make it happen. We are able to simplify and streamline this process by providing a summary checklist of what you will need to comply.

 

Time is running out, you need to act now

The official deadline for CCA submissions is October 31st 2018. However, it takes time to set up a CCA and we are advising anyone looking to do so, contact us no later than June 2018. If you miss the deadline you will not receive savings through the six years the scheme is running for.

 

What is the average saving?

For example, an electricity spend of £100,000 based on 10p/kWh would equate to a CCL charge of around £5,680. On average a CCA could allow for 90% discount on this CCL charge saving, £5,112 per annum.

Download our CCA information sheet

Climate Change Agreement
Click here to download >

Is your CCA compliant?

 

A recent survey with clients revealed 75% were at risk of losing their CCA due to non-compliance. Not only is this a HMRC issue with hefty fines for directors, it can also carry a reputational impact.

 

A common mistake most businesses are making is thinking that their trade association has their CCA compliance in hand; this is unfortunately not the case and they have subsequently had their CCA revoked.

 

How we can help

By reviewing your CCA we can identify any areas of non-compliance and work with you to get things back on track. Our review will also reveal if you are taking advantage of the full discount available to you, giving you additional savings on your energy bill.

 

It’s really important to review your CCA every 12 months to ensure compliance and avoid fines, public naming and shaming and worse, your CCA being removed.

 

Here are some examples of recent client reviews:

  • A wool processing company – not registering forms properly so not getting CCL discount.
  • A packaging and plastics manufacturer – added extra process not covered by initial CCA causing high carbon costs.
  • An electronic, machinery and tooling manufacturer – non-compliant scheme causing legal risk. Also opportunity to get 100% discount missed.
  • A manufacturer of orthopaedic solutions – stopped CCA but did not apply for exemption.

For further information about how your company can benefit from a CCA speak to a member of our expert team by calling 01282 611329, alternatively email sales@businesswisesolutions.co.uk