Climate Change Levy (CCL): what UK businesses need to know

What CCL is

The Climate Change Levy is a per-kWh environmental tax added to UK business gas and electricity bills. It was introduced in 2001 to encourage business energy efficiency and applies to almost all commercial energy use.

CCL is collected by your energy supplier on your invoice and passed to HMRC. The current rates are published annually — check the HMRC CCL rates page for the applicable figure.

Who is exempt or reduced-rated

Several groups either pay a lower CCL rate or are fully exempt:

• Charities using energy for non-business purposes
• Domestic use of energy (fully exempt)
• Very small users below the low-usage de minimis thresholds
• Energy-intensive sectors participating in a Climate Change Agreement (CCA) — up to 92% CCL reduction on electricity, 89% on gas.

How to check your CCL position

Look at your latest bill — CCL is shown as a separate line, typically in pence per kWh. If you think you should be exempt or reduced-rated, complete a supplier VAT declaration (PP11 for CCL) and submit it to your supplier. Energy Tariff can review your position and prepare the paperwork.