Introduction Background Note
5.CCL was introduced in 2001 and is a UK wide tax on the use of electricity, gas, solid fuel and liquefied gases used for fuel purposes by business and the public sector.
6.The purpose of the CCL is to encourage the efficient use of energy and the use of renewable energy, in order to help meet the UK’s international and domestic targets for cutting emissions of greenhouse gases.
7.CCAs were introduced alongside the levy in recognition of the levy’s impact on the competitiveness of energy-intensive sectors of industry. They are voluntary agreements made between the DECC and sector associations and their members. The agreements entitle participating facilities to pay a reduced rate of levy in return for meeting challenging targets for improving energy efficiency or reducing emissions.
8.The CCA scheme is a State Aid. A condition of the State Aid approval for the scheme in 2001 was that, for the last two years of the 10 year approval (1 April 2009 to 31 March 2011), the UK must introduce a mechanism to recover tax from facilities that fail to meet their targets during the period proportional to the extent that the targets were missed.