A guide to reducing your energy bills with the Climate Change Agreement

Statistics show that carbon dioxide (CO2) levels have increased by 40% since the industrial revolution.  This increase has been linked to the burning of fossil fuels for energy, agriculture and deforestation, as well as from manufacturing processes, such as those for producing chemicals and metals.

The UK government has made a commitment to tackling climate change, and in April 2013 it introduced Phase 2 of the Climate Change Agreement.  This agreement is due to run until March 2023 and aims to help UK businesses, which are deemed energy-intensive, reduce both their energy use and reduce COemissions.

The SEA is the designated sector association and administers two umbrella Climate Change Agreements, one for surface engineering and the other for heat treatment. Together with the Environment Agency, we have agreed the efficiency targets for both of these sectors.

Companies (operators) working within surface engineering or heat treatment sectors, who have signed up to an underlying agreement, are required to monitor and report their energy consumption against the agreed efficiency targets. If the operator meets its targets at the end of each reporting period, and continues in the scheme, then they will be eligible for a discount on the Climate Change Levy (CCL). The CCL is the tax introduced by the UK government with the intention of controlling energy use and emissions levels of businesses.

For operators who hold an agreement and meet their targets, the CCL will be reduced by 90% on electricity bills and 65% on all other fuels. Not only are businesses saving on the amount of taxation they are required to pay, by reducing energy use they are also saving money on their energy bills. For more information on how to operate your Climate Change Agreement, the Environment Agency has published a detailed Operations Manual which explains how to set up and manage an agreement, and how to report your energy data against the targets set.

The Carbon Trust has free publications for advice on reducing your organisation’s carbon footprint, which includes energy efficiency. These can be downloaded from their website.

If you are still left confused by the Climate Change Agreement and all that it involves, the SEA are here to help. You can contact us via email us at info@sea.org.uk or call us on 0121 237 1123.