The Climate Change Levy Explained

Get a quote in minutes Compare top UK suppliers Best price guarantee

Trustpilot Logo

Rated Excellent on Trustpilot
(Over 2,500 Reviews)

Get immediate pricing Save up to 65%
Choose your business address

Can’t see the address? Enter manually

Are you comparing for a business or home?

Business

Home


Go Back
Select Utility
Now please select a utility I want to get prices for...
Gas
Electric
Gas & Electric
Water
Go Back
Next
Please enter your business gas information
How much do you spend & how often?

An estimate is fine if you don't have a bill to hand

Go Back
Get Prices

Let’s save time, can we automatically gather meter information?

? What does this mean?
To get your quotes at lightening speed we need several key pieces of information which can all be found on your electricity bill. But by simply ticking this box, we can search ‘industry held data’ to get your meter number, electricity consumption and current energy supplier. This means that we can get you quick quotes without asking you to dig out all of your paperwork. This is personal data therefore we need you to allow us to access this information.
Go Back

Do you know your electric meter number?

Does your meter number end in any of the following?

Go Back
Enter meter number
I don’t know
Please enter your business electricity information
How much do you spend & how often?

An estimate is fine if you don't have a bill to hand

Start date for a new contract?
Get Prices
Please enter your water information
How much do you spend & how often?

An estimate is fine if you don't have a bill to hand

Go Back
Get Prices

    Enter your details below to get quotes We’ve helped over 90,000 businesses
    Trustpilot Logo

    Rated Excellent on Trustpilot
    (Over 2,500 Reviews)

    Guide Author

    James Longley

    Managing Director

    min read
    Last Updated April 5, 2023

    The climate change crisis is at the forefront of most people’s minds, including business owners and leaders. To reduce our impact on the environment, the UK government has introduced several environmental tax and relief schemes to encourage small, medium and large businesses to operate in a more environmentally conscious manner.

    The Climate Change Levy, along with the net zero carbon emissions scheme, are methods of encouraging businesses to improve their environmental footprint. But what exactly is the Climate Change Levy and how does it affect your business?

    In our guide, we answer your questions and offer some expert tips on how to reduce your carbon emissions to save money on your business energy and help the environment.

    What Is The Current Climate Change Levy Rate?

    There are two rates for the Climate Change Levy: the main rate and the Carbon Price Support rate.

    Main rate

    Any business that works in the commercial, industrial, agricultural, and public service sectors will be charged at the main rate for business gas, electricity, and solid fuel and these will be listed on your energy bills.

    The table below illustrates the main Climate Change Levy rates:

    Time Electricity Natural Gas LPG
    1st April 2020 to 31st March 2020 0.811p/kWh 0.406p/kWh 0.02175p/kg
    1st April 2021 to 31st March 2022 0.775p/kWh 0.465p/kWh 0.02175p/kg
    1st April 2022 to 31st March 2023 0.775p/kWh 0.568p/kWh 0.02175p/kg
    1st April 2023 to 31st March 2024 0.775p/kWh 0.672p/kWh 0.02175p/kg

    Carbon Price Support rate

    If your business operates combined heat and power stations, then you will need to pay the Carbon Price Support rate, which is designed to reduce carbon emissions produced by businesses. Your business will become liable for the Carbon Price Support rate when gas passes through the meter at the generating station and LPG, coal or other solid fossil fuels are delivered through the entrance gate to the generating station.

    The table below illustrates these rates:

    Time Gas Petroleum gas Coal or other solid fossil fuels
    1st April 2015 to 31st March 2016 0.00334p/kWh 0.05307p/kWh 1.56860p/GJ
    1st April 2016 to 31st March 2025 0.00331p/kWh 0.05280p/kWh 1.54790p/GJ

    Businesses that generate their own energy, such as through solar panels, are unlikely to pay the levy since they will be classed as a small generator.

    How Is The Climate Change Levy Charged?

    Business energy suppliers oversee adding the Climate Change Levy to your commodities. On your energy bill, the levy charge will feature as a separate line. Once the business energy suppliers have collected the money from their customers, the suppliers will pay it to HM Revenue and Customs.

    All businesses must register for the Climate Change Levy unless they are exempt. If you do not register or you the levy, then you will be charged a penalty of £250 each time.

    Who Is Exempt From Climate Change Levy?

    So, who is exempt from Climate Change Levy? If you meet the following requirements, then your business may be exempt from the levy charge:

    • You are a charity involved with non-commercial activities
    • Your company uses only a small amount of energy, generally around less than 145kWh of gas and 33kWh of electricity a day.
    • You are a domestic energy user, such as homes, caravans, self-catering accommodation, and schools.

    How Can My Business Pay A Reduced Rate On Climate Change Levy?

    Do you want to pay less for your Climate Change Levy charges? The most effective way to start saving on your main rate is by signing the Climate Change Agreement (CCA).

    With a CCA, you’ll get a discount of up to 90% on your CCL rates on electricity and a 65% discount on all other fuels. However, you must make improvements to your business to reduce your average energy consumption.

    When you sign the CCA, you agree to measure and report on your business energy use and carbon emissions against specific targets over a certain period. After this period has passed and your business has achieved those targets, you will receive the discount.

    Want to find out whether your business is eligible for a CCA? .

    What If I’ve Overpaid on the Climate Change Levy?

    If you think your organisation has paid too much on your CCL, it’s possible to reclaim it as a tax credit.

     

    How Can a Business Reduce Its Carbon Footprint?

    Struggling to find ways of making your business more energy efficient? We’ve listed our three small changes your business can make to reduce energy consumption and, in the process, its carbon footprint.

    1. Adjust the thermostat

    Changing the temperature of the office can be a difficult decision. Someone will always be too warm or too cold. However, reducing the temperature by one degree can make a huge difference to your energy bills. 20 degrees is best for offices and around 16 degrees is best for warehouses.

    Work with your employees too. Move those who run warm to desks nearer the windows and doors and for those who are cold, maybe introduce office blankets or hot water bottles.

    2. Switch energy providers

    Everyone knows that you can lower your energy bills by switching to a different provider, however did you know that you can become more energy efficient by switching to green providers?

    By switching to renewable energy, you can add green credentials to your company and increase your corporate social responsibility. Plus, you’ll be helping the environment and encouraging the development of greener sources of energy.

    3. Switch off standby

    We’re all guilty of leaving appliances on stand-by, whether that’s at work or at home. But by switching off computers, monitors, and kitchen appliances, you can make a significant saving on your energy bills.

    The Climate Change Levy was designed to encourage businesses, like yours, to reduce their carbon emissions and become more energy efficient. Want to learn more about how you can make your business more energy efficient? Explore our Business Energy Efficiency Guide .

    If you need more help with reducing your energy wastage and saving money, then why not get in touch? Our friendly experts will help you find the best deals on your business energy and offer tips on how to reduce your carbon footprint.

    Get the best prices and deals on your utilities

    Immediate pricing access to almost all UK suppliers

    Utility Bidder
    Business Gas

    Business Gas

    Immediate pricing access to all major UK gas suppliers. We can save you upto 65% on your business gas prices.

    Business Electricity

    Business Electricity

    We manage 20,000 electric meters for our commercial customers – So you’re in safe hands.

    Business Energy

    Business Energy

    We’ll find the best prices and provide you with a hassle free service for both your business gas and electricity….

    Business Water

    Business Water

    With our help. You’ll get a better quality service, lower water bills and better value for money.

    Compare business electricity rates and business gas prices

    It only takes a couple of minutes to save £100's on your utility bills

    Go Back
    x

    Get your estimated savings in minutes

    We compare live prices from 27+ suppliers

    Get a quote in minutes Compare top UK suppliers Best price guarantee

    Trustpilot Logo

    Rated Excellent on Trustpilot
    (Over 2,500 Reviews)

    Get immediate pricing Save up to 65%
    Choose your business address

    Can’t see the address? Enter manually

    Are you comparing for a business or home?

    Business

    Home


    Go Back
    Select Utility
    Now please select a utility I want to get prices for...
    Gas
    Electric
    Gas & Electric
    Water
    Go Back
    Next
    Please enter your business gas information
    How much do you spend & how often?

    An estimate is fine if you don't have a bill to hand

    Go Back
    Get Prices

    Let’s save time, can we automatically gather meter information?

    ? What does this mean?
    To get your quotes at lightening speed we need several key pieces of information which can all be found on your electricity bill. But by simply ticking this box, we can search ‘industry held data’ to get your meter number, electricity consumption and current energy supplier. This means that we can get you quick quotes without asking you to dig out all of your paperwork. This is personal data therefore we need you to allow us to access this information.
    Go Back

    Do you know your electric meter number?

    Does your meter number end in any of the following?

    Go Back
    Enter meter number
    I don’t know
    Please enter your business electricity information
    How much do you spend & how often?

    An estimate is fine if you don't have a bill to hand

    Start date for a new contract?
    Get Prices
    Please enter your water information
    How much do you spend & how often?

    An estimate is fine if you don't have a bill to hand

    Go Back
    Get Prices

      Enter your details below to get quotes We’ve helped over 90,000 businesses