CCAs are a voluntary scheme first introduced in 2001, for non-domestic energy intensive sectors, to encourage them to reduce energy use and reduce CO2 emissions. In return, participants receive a discount on the Climate Change Levies (CCL). For participants who hold a CCA, as of April 2022, the CCL will be reduced by 92% on electricity bills and 89% on gas.
How Does it Work?
CCA compliance requires the participating entity to monitor, record, calculate energy consumption and report carbon emissions against targets set for each target period. Participants are required to report energy consumption from their business activities. Meeting targets at the end of each target period will ensure that the participant will continue to receive the CCL discount.
A new CCA scheme began on 1st January 2026, with targets running to the end of 2030. The first target period (Target Period 7) covers January 2026 to December 2026. The second (Target Period 8) runs between January 2027 and December 2028, and the third (Target Period 9) between January 2029 and December 2030. The scheme will provide CCL discount rates until March 2033. Under the new scheme, targets are set and reported at facility level.
Meeting targets at the end of each target period will ensure that the participant will continue to receive the CCL discount; this total discount can be up to 92%. However, failing to meet targets will require the participant to pay a ‘buy out’ fee. For Target Period 7, the buy-out fee is £37 per tonne of CO2e by which a facility falls short of its target. Participants failing to pay the buy-out fee will be decertified from the scheme.
Who is Eligible?
CCAs are available for a wide range of industry sectors from major energy-intensive processes such as chemicals, paper, food & drink and supermarkets to agricultural businesses such as intensive pig and poultry farming. There are around 51 sectors involved.
Existing participants were not automatically migrated to the new scheme and were required to confirm their eligibility. New entrants in eligible sectors can apply between 1st January and 31st August each year. The 2026 window has now closed, and the next opens on 1st January 2027.
LGE’s Service Offering
Our CCA service includes all aspects of data collection, monitoring, reporting CCA performance against targets, liaising with sector associations and assistance with the forecast and calculation of potential carbon buy-out if required. In addition, clients will have access to LGE’s energy management advisory service which provides further cost benefit via energy reduction to clients. LGE have provided the following list of services:
- Internal audits to identify potential risks of non-compliance and identify areas of strength
- Assessment of current energy consumption and carbon emissions
- Assessment of metering and where energy is actually consumed on site
- Benchmarking of current emissions to identify areas of improvement
- Review of current energy policy
- Maintenance of CCA evidence reporting pack
- Advisory and recommendation role
- CCA database maintenance and management
If you believe you could benefit from the discounts offered through the CCA scheme then speak to your account manager today or contact us at info@lgegroup.com.