quote
menu

Renewable energy loses Climate Change Levy (CCL) exemption


The recent budget confirmed the removal of the Climate Change Levy (CCL) exemption for renewable electricity. The implications for SMEs are significant.

The budget was marked by substantial cuts to government spending to move towards the aim of eliminating the deficit. While the reductions in benefits attracted the most attention, changes to the renewable energy market could have more impact on small to medium sized businesses.

Renewable sources of energy and the CCL

Renewable source electricity (RSE) will be liable for the Climate Change Levy (a tax on energy delivered to non-domestic users in the UK) after Levy Exemption Certificates (LECs) are dropped (although there is no timetable). Power generated by wind, solar or other sustainable sources will be more expensive, with the increases in price likely to be passed to business customers. You can find more of the detail in the official government document.

Some observers see this as a necessary reduction in expensive subsidies: the Chancellor said the removal of the exemption will earn the Treasury £450 million in 2015/16, rising to £910 million in 2020/21. But others complain that the move sets back the UK’s journey to becoming a low-carbon economy, especially as the government has been supportive of fracking and has lowered taxes on North Sea oil and gas.

RenewableUK, the trade association representing the wind, wave and tidal energy industries, is one of the critics. Its Director of Policy, Dr Gordon Edge, called it “a punitive measure for the clean energy sector” that undermines “vital financial support for renewable energy producers” and constitutes “another example of this Government’s unfair, illogical and obsessive attacks on renewables”.

“We’re suddenly looking at a substantial amount of lost income for clean energy companies which was totally unexpected,” Edge added. “Levy Exemption Certificates account for just over 6% on onshore wind generators’ revenues.”

Cheaper, greener business energy

While generators fret about projects slipping into unprofitability, there may be an unexpected silver lining for small to medium sized companies. As suppliers scramble to find customers for their renewable sourced electricity, there are eye-catching discounts on green energy, at least in the short term.

For SMEs looking to ‘go green’ there has never been a better time. Even those more motivated by price might be surprised by how much cheaper electricity rates have become. For a fast expert overview of your options just fill in the form at the top right of this page or call 0330 0100 251. You could be getting cheaper, greener energy in just 20 minutes.

Related Articles

energy-meter-reading-numbers

Business Electricity Meter Types

There is a wide range of electricity meters that your business may have installed, depending on your electrici...

Read More

10 Bizarre Christmas Traditions From Around The World

Everybody has their traditions at Christmas. From watching a pantomime starring a questionable celebrity cast,...

Read More

Which country gets the most time off at Christmas?

Christmas is celebrated differently all over the world, just look at our 10 Bizarre Christmas Traditions artic...

Read More
Excellent, 9.8 / 10

Fantastic

"Fantastic! Very happy with the service received Would definitely recommend"

This review was posted by Room 305 on the 06th of December 2017

I've used Switch My Business for a few …

"I've used Switch My Business for a few years because they literally do everything for you with no fuss. Mark Weeks was incredibly helpful, friendly and understood how busy I was. He explained everything simply, clearly and found rates that matched my needs perfectly (needed a 0 fee standing rate gas supply). He prepared all the paperwork so all I had to do was print, sign and scan. Highly recommended!"

This review was posted by Jay Grocott on the 06th of December 2017

Mark Weeks is very informative of the …

"Mark Weeks is very informative of the current market and helped us change our utility provider effortlessly on an attractive contract"

This review was posted by Alex Slee on the 05th of December 2017

EXCELLENT SERVICE

"It was a seamless switch and Mark Weeks was extremely helpful and knowledgeable. I will be using SMB again on the next renewal date."

This review was posted by Marc Hesford on the 05th of December 2017

Mark Weeks provided quotations for my …

"Mark Weeks provided quotations for my search for alternative electricity supplier which were competitive though not significantly better than our current supplier. Very useful however."

This review was posted by john barrus on the 05th of December 2017