With the upcoming closure of the Carbon Reduction Commitment Energy Efficiency Scheme (known as the CRC) in April 2019, almost every business will see a significant increase to their energy costs. As the government will lose revenue from one scheme, it was decided an increase in Climate Change Levy (CCL) rates would bridge the loss of revenue.
The NFU CCL scheme offers businesses in energy intensive sectors the opportunity to receive CCL discount, in return for meeting agreed energy efficiency targets. Therefore, Climate Change Agreement (CCA) holders will not be significantly impacted by these changes because CCL discount rates will increase in April 2019. This means businesses holding a CCA will only see an increase in energy costs in line with the Retail Price Index (RPI).
Since 1 April 2013, the discount on CCL has been 90% for electricity and 65% for other qualifying fuels. From the 1 April 2019, the discount will increase to 93% for electricity and 78% for other fuels.
For example:
Over a two year period, an indoor all through pig producer housing 120 sows:
|
Pig Farm |
Non-members pay |
CCL member pays |
Savings |
|
2017-2018 |
£3,500 |
£300 |
£3,100 |
|
2019-2020 |
£5,100 |
£400 |
£4,700 |
Over a two year period, a horticulturalist growing tomatoes* in a 5,000m2 production area heated by a gas boiler:
|
Horticultural Grower |
Non-members pay |
CCL member pays |
Savings |
|
2017-2018 |
£10,300 |
£3,000 |
£7,300 |
|
2019-2020 |
£16,900 |
£3,200 |
£13,700 |
*Any crops grown in controlled, environment-protected structures are covered by the scheme.
Over a two year period, a poultry farm with 280,000 bird places:
|
Poultry Farm |
Non-members pay |
CCL member pays |
Savings |
|
2017-2018 |
£4,600 |
£600 |
£4,000 |
|
2019-2020 |
£6,900 |
£600 |
£6,300 |
The examples clearly show how the increase to CCL rates will impact businesses not participating in the CCL scheme and those who are in different ways.
If you are currently rearing indoor pigs for meat production, indoor birds for meat and egg production or growing crops within protected structures, then you should consider participating in the NFU CCL scheme.
The deadline for new or re-entries into the scheme is 30 October 2018. However, applications must be received and processed no later than 30 June 2018.
Joining the NFU CCL scheme may significantly reduce the amount of CCL you need to pay. We have created a CCL calculator to help you determine how viable it would be to you and your business. Please visit http://ccl.fec-energy.co.uk/ccl-calculator and follow our three simple steps.