Tax incentives help save 6.6 million tonnes of CO2 emissions

9th December 2021

UK firms receiving tax breaks in exchange for setting energy efficiency targets cut their emissions by 6.6 million tonnes between 2019 and 2020, the Environment Agency (EA) has revealed.

This equates to an overall emissions reduction of 13.3% across a total of 8,705 facilities signed up to the the Climate Change Agreements (CCA) scheme.

Participants receive a reduction in the Climate Change Levy – a tax that is applied to commercial electricity, gas, and solid fuel bills – for meeting energy efficiency targets agreed by the government and sector associations.

In total, the EA’s latest biennial report shows that, between 2013 and 2020, the CCA scheme has seen total emissions savings of 23.8 million tonnes of CO2 equivalent.

Chief executive, Sir James Bevan, said: “The CCA scheme is encouraging businesses to find ways to reduce their energy usage and consequently their carbon emissions. Innovation is key, and the EA is here to support that through progressive regulation.

“We are already seeing the effects of climate change in the UK, so it is vital that businesses face up to the challenge of adapting to a different climate, thinking about energy use as well as the use of natural resources, such as water, which will become more scarce in the future.”

During the 2019-20 reporting period, the operators of 1,510 CCA agreements, covering 3,110 facilities, met or exceeded their improvement targets.

Operators who failed to meet their targets used any banked emissions savings from previous target periods, and paid a buy-out fee for each outstanding tonne of emissions above the target.

The scheme is administered by the EA on behalf of the Department for Business, Energy and Industrial Strategy, encouraging industry-wide energy reduction as the UK aims for net zero by 2050.

Speaking at the latest report's publication on Tuesday, business and energy minister, Lord Callanan, said: “Industry has a critical role to play in helping the UK meet its net-zero target by 2050, and today’s report shows the immense progress being made to improve energy efficiency and reduce carbon emissions across UK sectors.

“We expect to see results like these continue as the UK business community demonstrates how both green and growth go hand in hand.”

Image credit: iStock

Transform articles

Three in four pension schemes to have net-zero plans

Three-quarters of UK pension schemes have plans to align their investments with net-zero emissions, or will do within the next two years, a recent survey has found.

26th May 2022

Read more

Tom Pashby talks about why the new Natural History GCSE is such an important step forward for climate and biodiversity preservation

26th May 2022

Read more

Tom Pashby gauges IEMA members’ reactions to recent IPCC reports

26th May 2022

Read more

Financial constraints are the biggest challenge for seven out of 10 councils when looking to achieve net-zero emissions, a survey of decision-makers at 50 UK local authorities has uncovered.

20th May 2022

Read more

The climate targets of oil and gas majors rely heavily on emissions mitigation technologies (EMTs) that are expensive and unproven at scale, analysis by Carbon Tracker has uncovered.

12th May 2022

Read more

IEMA has urged the UK government to focus on delivering sustainable growth for the country after 38 bills were unveiled in the Queen's speech today.

10th May 2022

Read more

The UK government has today unveiled a new strategy detailing how the country's education sector will become a “world leader in climate change” by 2030.

21st April 2022

Read more

Limiting global warming to 2°C above pre-industrial levels is now possible if all nations honour the climate pledges made at the Glasgow COP26 conference last year, a new study has found.

14th April 2022

Read more

US companies registered with the Security and Exchange Commission (SEC) could be forced to report the climate-related impacts of their business under plans announced by the regulator this week.

24th March 2022

Read more

Media enquires

Looking for an expert to speak at an event or comment on an item in the news?

Find an expert