The CCL rates will increase by 45% for electricity and 67% for natural gas from 1st April 2019. The table below illustrates the change.
This increase is a move to recover the energy consumption tax which has been collected via the soon-to-be-discontinued CRC Scheme.
The 2,000 companies caught by CRC will pay less energy consumption tax annually. This is because the CCL increase will be more-than-offset by the absence of CRC costs after this final reporting cycle.
While there is going to be some overlap between the new CCL rates and the final CRC payment due in September 2019, there will at no point be an annualised full double payment of CCL and CRC.
The change is modelled below on a CRC Participant with a £1,000,000 annual energy spend.
Companies that are not caught by the CRC will face a significant increase in energy consumption tax and will not be accustomed to including a similar sum in their budgets each year to cover CRC costs.
As before, the change is modelled below on a non-CRC Participant with a £1,000,000 annual energy spend.
For more information on CCL and the exemptions, please see our previous blog here: https://carboncredentials.com/impact-of-changing-ccl-rates/
Alternatively speak to a member of our team at firstname.lastname@example.org
Note that CCL applies to ‘taxable commodities’ (as per Section 2.1 here), which includes electricity and natural gas. This blog considers only the impact on electricity and natural gas.
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