Welcome to the latest Energy Matters Briefing
Following the review, HM Treasury undertook a consultation with industry. This was completed in November 2015. The government has since responded to the consultation and confirmed a series of financial measures, including the ending of the CRC Energy Efficiency Scheme and planned increases to the Climate Change Levy (CCL - which is applied to the supply of energy to non-domestic customers).
There will be a more detailed consultation on changes to the reporting framework, including policy design and implementation over the summer – which again, businesses will be encouraged to participate in.
July 2015: Government announces a review
Sept 2015: Government publishes consultation policy paper
Sept – Nov 2015: Industry consultation
March 2016: Government response
Summer 2016: Further consultation
April 2019: CRC Energy Efficiency Scheme will be scrapped & higher CCL charges will be introduced
The autumn review was prompted by the understanding that a plethora of energy efficiency regulations are imposing unnecessary red tape and bureaucratic inefficiencies on business. This is hampering business productivity.
Over the past 15 years, a number of overlapping policies encompassing tax, regulation and voluntary schemes have been introduced, to encourage the uptake of energy efficiency and low carbon measures. These include the CRC Energy Efficiency Scheme, CCL, the Energy Savings Opportunity Scheme (ESOS), Climate Change Agreements (CCAs), mandatory Greenhouse House Gas (GHG) reporting, the Enhanced Capital Allowance scheme (ECA) and the Electricity Demand Reduction (ECA) pilot.
The plan is to streamline these reporting obligations with one reporting framework and enhance the role of the CCL, to make it the key driver for energy efficiency.
In this issue, we’ll explain how the introduction of a simplified energy efficiency tax could impact you and what you can do to mitigate the negative effects.