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Climate Change Levy (CCL)

Another line says Climate Change Levy and it isn’t obvious why your business pays it. This guide covers what CCL is, typical bill impact in money terms, and narrow exemptions that might apply.

Next step: If you use under about 50,000 kWh a year, you can get a quote in under 90 secs online — fast, no obligation. Bigger supply, half-hourly metering, or prefer chat? Use the contact page.

What Is CCL?

Climate Change Levy (CCL) is a tax on most business gas and electricity use, shown separately on your bill. It is charged per kilowatt-hour; amounts change over time with government policy, so always check the rate on your own invoice when budgeting. For how it sits with other bill lines, see our guide to understanding bills and pass-through charges.

2026 Rates:

• Electricity: 0.775p/kWh
• Gas: 0.568p/kWh

These rates typically increase annually with inflation. CCL applies to most businesses but NOT to domestic (home) energy.

How Much Does CCL Cost?

Example 1: Small office (20,000 kWh/year electricity)

20,000 kWh × £0.00775 = £155/year CCL

Example 2: Medium business (30,000 kWh electricity + 15,000 kWh gas)

• Electricity CCL: 30,000 × £0.00775 = £232.50
• Gas CCL: 15,000 × £0.00568 = £85.20
• Total CCL: £317.70/year

As an illustration only: on a £5,000 annual electricity spend, CCL might add a few hundred pounds a year depending on your mix of fuels, exemptions and exact rates—never treat a round percentage as “standard” for every firm.

Who Is Exempt From CCL?

Automatic exemptions:

• Renewable electricity: If you buy electricity from 100% renewable sources with green certificates (LECs), no CCL applies
• Domestic use: Residential properties don't pay CCL
• Charities: Registered charities qualify for exemption
• Very small users: De minimis amounts (under certain thresholds)

Reduced rates available for:

• Energy-intensive industries: Businesses with Climate Change Agreements (CCAs) can get 90% CCL discount if they meet energy efficiency targets
• Combined Heat and Power (CHP): Qualifying CHP installations get reduced rates

Can You Avoid CCL?

For most small businesses: No. CCL is mandatory on non-renewable electricity and all gas consumption. You cannot negotiate it away.

What you CAN do:

• Switch to 100% renewable electricity tariff (eliminates electricity CCL)
• Reduce total consumption (reduces CCL proportionally)
• Check if your industry qualifies for Climate Change Agreement (energy-intensive sectors only)

Renewable electricity illustration: a site on fully renewable electricity may avoid CCL on that power—but headline rates and passthroughs still differ, so compare total annual cost. Our renewable energy guide walks through sensible questions to ask.

Related Guides

Your next step: When you are ready to compare business tariffs, get a business energy quote online (typically under a minute, no obligation). Larger supply, half-hourly metering, or you prefer messaging? See the contact page.