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Become an eco-conscious business – Taking advantage of Climate Change Agreements
13 January 2025

Taking advantage of green tax reliefs is a good way to reduce how much Climate Change Levy tax (CCL) your business pays.

To get these reliefs, your business will need to operate in a more environmentally friendly way.

Any business in the industrial, public services, commercial and agricultural sectors is subject to the CCL Tax.

It is charged on ‘taxable communities’ for heating, lighting and power purposes. It is not charged on road fuel and other oils that are already subject to excise duty.

You may get relief from some taxes, for example, if:

• You use a lot of energy because of the nature of your business
• You are a small business that does not use much energy
• You buy energy-efficient technology for your business

Meanwhile, meeting the following requirements may exempt you from paying the CCL:

• Your business uses small amounts of energy – less than 33kWh electricity and/or 145kWh gas a day
• You are a domestic energy user – energy is used in homes, schools, caravans and self-catering accommodation
• You are a charity involved with non-commercial activities

How can my business reduce the CCL it is eligible to pay?

For eligible companies that do pay the CCL, it is possible to pay a reduced main rate if you enter a Climate Change Agreement (CCA) with the Environment Agency.

Paying a reduced rate means you will be required to improve your business’s energy efficiency and lower your average energy consumption.

Those businesses bound by a CCA will receive a reduction of 90 per cent in the CCL rate paid on electricity bills and a 65 per cent reduction on all other fuels.

You will also have to measure and report your business’s energy use and carbon dioxide emissions against targets set over two-year terms.

If you meet the targets set at the end of each term, you will continue to receive a CCL discount.

To find out how to make the most of green tax reliefs, get in touch with one of our advisers.