On 29th of August 2017 the Environment Agency has published the Guidance on Climate change agreements. The Guidance explains how climate change agreements (CCAs) work, who is eligible for a CCA, and sector associations with CCAs.
In order to reduce energy used and carbon dioxide (CO2) emissions, the Environment Agency and the UK industry have established climate change agreements. In return, operators receive a discount on the Climate Change Levy (CCL), a tax added to electricity and fuel bills. The Environment Agency administers the CCA scheme on behalf of the whole of the UK.
For operators who hold a CCA, the CCL will be reduced by:
90% on electricity bills
65% on other fuels
A wide range of industry sectors can benefit from the CCAs. The sectors include major energy-intensive processes such as chemicals, paper, supermarkets and agricultural businesses such as intensive pig and poultry farming.
There are two types of CCAs: umbrella agreements and underlying agreements.
The Department of Energy and Climate Change and industry sectors negotiated umbrella agreements. The agreement is held between the sector association and the Environment Agency. Umbrella agreements also list the processes that are eligible for a CCA.
An underlying agreement is held by a site, or group of sites, owned by an operator within a particular sector. This contains energy or carbon efficiency targets appropriate for their type of operation. Sector associations manage the underlying agreements for businesses in their sector. An operator that wants to enter into a CCA must apply first to its sector association.
The Contents of the Guidance are:
