Budget 2016: Climate and Energy Announcements


The Treasury has announced that the CRC Energy Efficiency Scheme (CRC) will close from April 2019 and that a new streamlined annual reporting regime will be introduced. A full consultation on the new framework will be launched in summer 2016. It is proposed that the eligibility criteria for ESOS is used to decide who should be included and that mandatory annual reporting will be required.

In order to recoup the government’s revenue from CRC, Climate Change Levy (CCL) rates will be increased from April 2019.

Climate Change Agreements (CCAs) will continue. Sites with CCAs will receive an increased discount to CCL from April 2019. That is, a discount of 93% for electricity (currently 90%) and 78% for gas (currently 65%). The government will keep the existing CCA scheme eligibility criteria in place until at least 2023. The previously announced CCA target review of the buy-out price for target periods 3 and 4 will recommence later this year.

The government stated its support of Mandatory Greenhouse Gas (GHG) Reporting, heeding calls from large businesses for it to continue. GHG reporting is a current annual requirement for listed companies.

Carbon Price Support will remain capped at £18/tCO2 to 2019/20 and will increase by RPI in 2020/21. The long term direction for Carbon Price Support will be given in the autumn 2016 statement.

The allocation of £730 million for further Contract for Difference auctions will be given over the course of this parliament for offshore wind and other less established renewable technologies.

Further tax reductions were put in place for the North Sea oil and gas industry.

Written By – Nikki Wilson

Alfa Energy Group

Alfa Energy Group, an Edison Energy company, is an international energy, sustainability and technology consultant partner with 200 employees over 4 international locations. For over 25 years, Alfa has been servicing its clients’ needs through energy and water management, sustainability, and compliance consulting, and an intuitive ecosystem of user-driven energy, water, and carbon management software platforms. With coveted awards, an international industry-wide recognition, and clever simple solutions, today Alfa is partnering with clients to establish and deliver pivotal net zero strategies. Through smart energy management, the expertise and diligence of its people, transparent processes, and data management, Alfa continues to lead through its recognised gold standard of service delivery.