Billing and Payments

Climate change is widely recognised as the most important environmental challenge facing all countries today. There is growing scientific consensus on the potential impact on our climate of increasing concentrations of greenhouse gases.

CCL is a government initiative introduced in 2001 to encourage businesses to be more energy efficient to reduce greenhouse gas emissions and to help meet the UK’s environmental targets.

The levy is chargeable only on units/kWh used and not on any other part of the bill, e.g. the standing charge. VAT at the standard rate is added to CCL charges.

Separate CCL rates have been set for electricity and gas, and are index-linked, so likely to change on 1 April each year.

CCL Exemption

In certain circumstances, businesses will be wholly or partly excluded, or exempt, from paying CCL on their energy supply.

Legislation states: 

Where VAT is charged at the reduced rate, the supply is excluded from CCL.
Where VAT is charged at the standard rate, CCL (plus VAT on CCL) will usually be added to the bill.

Domestic or charitable non-business use
If the electricity or gas supply is used wholly or partly for domestic or charitable non-business use, that part of the supply qualifies for the reduced rate of VAT and is therefore excluded from  CCL. If you haven’t already, you will need to submit a VAT Certificate of Declaration to advise us what percentage of the supply qualifies on this basis.

Business or non-domestic use and low usage
Under a government concession, ‘low usage’ of electricity and gas for business or non-domestic purposes is chargeable at the reduced rate of VAT and therefore automatically excluded from CCL. You don’t need to take any action.

For more information on whether your business qualifies for exemption, please visit the HMRC website.
 

The government has given the following types of supply full or partial relief from CCL.

Supplies that qualify for up to 100% relief:

• Some forms of transport
• Combined Heat & Power (CHP) schemes covered by CHPQA (Combined Heat & Power Quality Assurance certificate)
• For more information on whether your business qualifies for relief or exemption, please visit the visit the HMRC website.

Supplies that qualify for up to 90% CCL relief  

Government gives special consideration to energy-intensive industries given their energy usage and their exposure to international competition. Examples include major energy intensive processes such as steel, chemicals and cement, and agricultural sectors such as intensive pig and poultry rearing. These are typically decided by business processes rather than particular sectors and are decided on a case-by-case basis.

You could qualify for up to 90%* relief from the CCL through a Climate Change Agreement (CCA) if you agree to challenging targets for improving energy efficiency or reducing carbon emissions. For more information on CCAs and to see whether your business is eligible, visit the Environment Agency website.

*90% relief applies only to electricity supplies. Gas supplies may qualify for a maximum of 65% relief.

If you are eligible for relief, send a completed PP11 Supplier Certificate to us:

VAT-CCL Compliance Section
EDF Energy
Freepost
Admail ADM3814
London
WC1V 6AJ

You will also need to send the completed the PP10 paperwork to HM Revenue & Customs (HMRC). Learn about the government's VAT guidelines.

Please note: PP11s cannot be transferred from one supplier to another. You will need to ensure that an updated PP11 is submitted to the new supplier to ensure you continue getting relief. 

For further information visit HM Revenue & Customs.